Blog Article

A tax year end action plan

A tax year end action plan

Date: 2 February 2024 | By: cosgrove

What action do you need to take before 5 April 2024?  It’s crucial to think about external factors and a tax year end action plan. Factors such as inflation and reduced or frozen allowances could impact your finances.

Have you considered whether you will be affected by the reductions to the Capital Gains Tax (CGT) exemption and Dividend Allowance? If so, have you thought about investing up to £20,000 this tax year in a stocks and shares ISA?

The Dividend Allowance will be reduced from £1,000 to £500 from April 2024. In addition, the annual CGT exemption will fall from £6,000 to £3,000 from April 2024. Dividends received on any shares held within an ISA are tax free and won't impact your Dividend Allowance. In addition, any profit you make when selling investments in your stocks and shares ISA is free of CGT.

Pension Considerations
The Lifetime Allowance for pensions will be abolished from next April. This is good news, but the Annual Allowance remains in place, at £60,000 for most people. Remember you can only get tax relief up to the amount you earn, but if your earnings are less than £3,600 you can pay in up to £2,880 and still get tax relief.

Preparation is key
More and more people are being impacted by stealth tax or fiscal drag and we can’t stress enough the importance of tax year end planning. You need a tax year end action plan. It remains vital to ensure you are in the best place possible to take advantage of any allowances, exemptions, and reliefs available this fiscal year and to plan ahead. Valuable financial advice remains central to
achieving your goals and aspirations.

If you need any advice on a tax year end action plan, please get in touch today. Download our factsheet Making-the-most-of-your-tax-allowances-and-reliefs-QFP---0423