Ask Cara – Tax Year End – March 2024

What do I need to know?
I thought it would be useful to point out some useful hints and tips to consider before 5 April.
ISAs – Should I consider one?

If you have a lot of cash in the bank, you might want to consider opening an ISA. This is a great way of making your money work harder for you. Any interest, dividends, or capital gains you make are completely tax free. You are only able to invest £20,000 per tax year, so for example, if you want to invest £30,000, you will need to invest £20,000 before the tax year end and the remainder in the next tax year. From my last seven years working in financial services, it still shocks me how few UK adults know of and have taken advantage of Stocks and Shares ISAs.

Do you have an investment portfolio that is not within an ISA?
Currently, you can earn £1,000 in dividends per year tax-free. From the new tax year, you will be taxed on all dividends above £500. This is particularly important to note if you pay yourself earnings in dividends. The capital gain tax free allowance is also be-ing lowered from £6,000 to £3,000. If you have an investment portfolio that has benefited from good growth, you might want to consider withdrawing from your portfolio up to the current higher allowance to save you on a higher tax bit in the new tax year.
If this portfolio is within an ISA, there will be no tax implications. Another bonus!

Try my Tax Year End Checklist
□ ISA – Have you used your £20,000 ISA (£9,000 Junior ISA) allowance?
□ Dividends and CGT – Are you thinking about how the cut in tax-free allowances will affect you?
□ Pensions – Are you using your tax efficient benefits pensions offer?
□ Personal Savings Allowance – Are you using your allowance?
□ Inheritance Tax – Have you used your annual £3,000 gifting allowance to reduce the taxable value of your estate?

To receive a complimentary guide covering wealth management, retirement planning or Inheritance Tax planning, please get in touch!

Cara Clare, Financial Advisor
Tel: 01234 480540