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Time is running out for tax allowances

Shropshire tax payers are being urged to make sure they are ready for the end of the current financial year which is just days away.

Francesca Hutcheson, Tax Director at Dyke Yaxley Chartered Accountants, in Shrewsbury and Telford, said it was now the perfect time to run through pre-year end planning points to keep your tax affairs in order.

“As a starting point, if you only do one thing, make sure you have made the most of your allowances for the tax year by April 5.

“And if you’re an employee, check your PAYE coding notice for both 2018/19 and the 2019/20 tax year to ensure you’re paying the right amount of tax.

“This is especially important if you have changed your company car as delays in updating your coding notice can sometimes cause unexpected and large tax bills.”

Francesca said anyone whose income was around any of the key thresholds or tax bandings could consider the timing of income and tax-deductible expenditure where possible.

“Subject to certain conditions, taxable income can be reduced through pension contributions and charitable donations.

“You should also check you have fully utilised your brought-forward pensions allowances, as any unused allowance for the 2015/16 tax year must be used before April 5 this year, otherwise it will be lost.”

Francesca said the Capital Gains annual exemption of £11,700 for 2018/19 could also not be carried forward and so, provided it was in line with your overall investment strategy, you should check whether you had fully utilised it.

“If you’re looking to sell an asset, consider whether a spousal transfer could help to ensure both of your annual exemptions and basic rate bands are used to the full to minimise your overall tax liability.

“Savers should check they have made the most of the Individual Savings Account allowance for 2018/19 for both themselves and their children.

“With time running out and the end of the financial year fast approaching, take time to check your tax affairs are in the very best of order and seek out expert advice to help make the most of your allowances.”

The Author

Mel Edwards

Mel Edwards

Marketing Assistant

Mel joined Dyke Yaxley in May 2017 as a Marketing Assistant after spending 2 years as an Administrations and Marketing Manager for a local Shrewsbury healthcare agency...