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its not long before the ending of the tax year approaches. It is vitally important to make use of any allowances and tax breaks that are .
By using the exemptions and allowances you might be able to bring down your tax bill substantially. This can usually be done quick and easily with the advice of a financial adviser.

Tax effective investments

Individual savings accounts
Individual Savings Accounts (ISAs). If you are aged over fifty your Isa allowance for the actual tax year is now £10,200. ISA’s are free from capital gains tax, can be used to provide a regular income and are one of the most tax efficient investment vehicles obtainable

Pensions

Pensions are also a tax efficient way of planning for retirement. Most people can contribute up to £3600 gross each year and obtain basic rate tax relief on the contribution made. 40% taxpayers can claim the remainder on their self assessment.

Capital Gains Tax Planning

If you have made profits on certain types of investments you may be able to use your yearly capital gains tax allowance. This will enable you to make gains up to this level without getting a liability to tax. In some cases it is also possible to carry forward previous year’s losses.

Income Tax Opportunities

Each individual can have a personal allowance of £6,475 without incurring any income tax. For espoused couples or civil partnerships, where one is a 40% taxpayer it is worthwhile looking to see who owns the investment and potentially look to transfer assets into the
20% twenty percent taxpayers name.Making annual gifts is also a way of reducing your liability to income tax.

Saving IHT

Each person can make an IHT exempt gift each year of up to 3,000 in a tax yr. Any unused allowance can be carried ahead for one yr only. If you are able to make gifts out of income without it altering your standard of living you may be able to make gifts above the yearly exemption limit.

If you consider your estate could be above the IHT nil rate band then good tax planning can be used to bring down your estates future IHT liability. This could include a suitably drafted will or alternatively trust planning.

Graham Bond is a Financial Adviser based in Chipping Sodbury, Bristol, South Gloucestershire.

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