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Use it or lose it: a tax year end checklist

The tax year ends on 5 April – what can you do? Use this checklist and make the most of your allowances with the money you have now. It’s all in here. Read on.

Published on 30 Jan 20234 minute read

Written by Frances Bruce

It’s as important as ever to use your allowances before the tax year ends on 5 April.

That’s why we’ve put together this checklist to help you get every last drop of value from your allowances and get yourself set up for the new tax year.

Remember, with investment your capital is at risk. 

Pay into an ISA

  • This year’s ISA allowance is £20,000

A hardworking ISA is the hero your money needs this tax year end (your pension is another). You can’t take your ISA allowance with you into the new tax year. But you can open an ISA before tax year-end, make the most of your allowance and enjoy excellent tax-free benefits. What’s not to love?

Put money in a Junior ISA

  • This year’s Junior ISA allowance is £9,000

You can open a Junior ISA for a child under the age of 18 if you’re the parent or guardian and then anyone can contribute. They work in exactly the same way as adult ISAs, except for the allowance.

Contribute to a SIPP or other pension

  • This year’s pension allowance is up to £40,000

Can you afford to pay more into your pension so you can benefit from tax relief? Every contribution counts no matter how small – don’t forget the magic of compounding!

Check if you can take advantage of pension carry forward

If you’ve used up your pension allowance for this tax year you may be able to carry forward any unused pension allowances from the previous three tax years.

Chip in to pensions for others

  • This year’s Junior SIPP or other child pension allowance is £2,880

Another way to make sure your money is squirrelled away tax-efficiently is to pay into a Junior SIPP or other child pension.  Or you may be able to contribute to your partner’s pension.

Reduce a future inheritance tax bill and give someone a helping hand

If you can afford to give money away you can use these allowances to avoid triggering inheritance tax or other tax charges:

  • £250 small gift allowance – you can give as many as you like
  • £3,000 tax-free gift allowance – you can give up to £3,000 in financial gifts every year. Your tax-free gift allowance can be split or given to one lucky recipient. You can carry your tax-free allowance forward for one year. This means you can give away £6,000 if you add both years’ allowances together

Check investments held outside your ISA and pension

Did you know dividend tax and capital gains tax allowances will be slashed from 6 April? Remember, you can sell your existing investments and use the money to top up and make the most of your ISA and pension’s excellent tax-efficient features:

Keep a tally of your contributions and make sure they don’t exceed your allowances.

How Bestinvest can help you this tax year end

Make the most of generous ISA and pension allowances and tax-free benefits with our award-winning Stocks & Shares ISA and Best SIPP.

Access our wide range of quality investments, save money with our tiered service fees and pay less the more you invest. 

Those keen to transfer to Bestinvest will be happy to learn we pay up to £500 towards any exit fees your current provider charges (T&Cs apply).

The clock is ticking - grab this tax year end by the allowances and make the most of your money!

Open a Stocks & Shares ISA

Transfer to a Stocks and Shares ISA

Open a Best SIPP

Transfer to the Best SIPP

Important information

Prevailing tax rates and reliefs are dependent on your individual circumstances and are subject to change.

SIPPs are not suitable for everyone.  If you don’t want to invest across different asset classes or don’t think you will make use of the investment choices that SIPPs give you, then a SIPP might not be right for you.

Before you consider transferring a pension, it is important to ask yourself: Will I lose any valuable benefits or features from my existing pension plan? If the pension is an employer-related plan, will the employer cease to pay in benefits if it is transferred elsewhere? Will I incur any penalties on my existing pension if I transfer? Will I lose any guarantees or beneficial features by transferring?   Is it an occupational final salary pension scheme? (in which case it is very unlikely to be advisable to transfer) Have I considered the charges on my current plan? (a new arrangement may be more expensive – especially if you have a stakeholder pension). Always check these potential issues with your current pension provider.

This article does not constitute personal advice. If you are in doubt as to the suitability of an investment please contact a financial adviser.

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