5th April 2014 – Last Minute Tax Planning Top Tips

As the tax year comes to an end, there is still time to save for 2013/14 and here are our top five tips:

Maximise Your Pension Contributions

A pension remains one of the most tax-efficient vehicles for long-term saving, particularly for higher rate taxpayers who can receive additional tax relief.

There is the additional prospect of saving National Insurance, 12% for employees and 13.8% for employers.

Maximise ISAs

Transfer savings of up to £11,520 (max £5,760 in cash) into a tax-free ISA to reduce income and capital gains tax.

Venture Capital Trusts (VCT) & Enterprise Investment Schemes (EIS)

Venture Capital Trusts (VCTs)  and Enterprise Investment Schemes (EISs) give 30% Income tax relief up-front.  EIS’s also provide relief from Inheritance tax after just 2 years and Capital Gains Tax deferral.

Whilst you will require assistance in choosing an appropriate VCTs or EIS, they can form a valuable base to minimise Income tax,  Inheritance tax and Capital Gains Tax.

Personal Tax Planning

Where one spouse is a lower/basic rate taxpayer, ensure that best use is made of personal allowances, age-related personal allowances and the CGT Annual Exemption of £10,600. This may involve transferring income generating assets to the spouse.

IHT planning

With the Inheritance Tax Nil Rate Band now frozen at £325,000, ensure that gift allowances are maximised and any outright gifts or gifts to trusts are made to start the 7-year clock running.

Should you require further information on any of the above then please contact the tax team on 0161 249 5040