A Shropshire accountant has urged tax payers to maximise every opportunity to save tax in the run-up to the end of the financial year.
Pam Mason, from Dyke Yaxley Chartered Accountants, in Shrewsbury, said there were several steps individuals and companies could take to minimise their tax liabilities.
“It’s vital that you capitalise on any allowances available such as the Annual Investment Allowance which can be claimed on most types of plant and machinery.
“If you make a purchase just before the end of the accounting year, then typically allowances will be available a year earlier, and you could spread the cost of larger amounts of expenditure over two years to maximise the tax relief you’re entitled to.”
Pam said tax payers should also consider deferring dividend payments until the start of the new tax year.
“And don’t forget every individual is entitled to their own tax allowances and exemptions – even children.
“The basic personal allowance for 2012/13 is £8,105 – this means, in certain circumstances, a couple and their two children could enjoy tax-free income and gains of at least £74,820, and income of up to £169,900 before paying higher rate tax.”
Tax-free savings are another option as individuals aged 18 or over can pay up to £11,280 into an ISA; 16 and 17-year-olds can invest up to £5,640 in a cash ISA; and Junior ISAs are available for under-18s.
“Think about your pension options too, as paying into a personal or company pension scheme can bring tax breaks of up to sixty percent on your pension savings, and employers may also be able to pay into the scheme.
“You must ensure though that pension contributions applying against your income for the current tax year are paid on or before April 5, so time is of the essence.
“Don’t lose out on the chance to save tax wherever you can. The end of the financial year is looming so it’s time to act now.”
Dyke Yaxley’s Pam Mason