Here are some key financial tips you need to think about before the end of the tax year on 5th April:
If you have savings or investments use (or lose) the following allowances by 5th April:
Use your ISA Allowance. You can shelter up to £15,240 of cash or investments from tax in the 2016/17 tax year.
Use your Personal Savings Allowance which allows you to earn up to £1,000 a year in savings interest tax free if you’re a basic rate taxpayer, or £500 if you’re a higher rate taxpayer.
Use your Dividend Allowance which means the first £5,000 of any dividends you earn from investments are tax free.
Save for your kids – you can invest up to £4,080 in the 2016/17 for each child in a Junior Isa.
Think about topping up your pension. You can top up your pension pot by up to £40,000 in 2016/17 – and also carry forward previous allowances for previous tax years if you haven’t used these. This means that you could potentially top up your pension by up to £170,000 – with a potential tax break of up to 45% depending on your own tax circumstances.
You can make capital gains by selling assets up to your personal annual allowance of £11,000 in the 2016/17 if you want to take any tax free profits.
For the very adventurous, you may consider investing in small companies either directly or through crowdfunding sites or through tax efficient funds. SEIS and EIS investments and Venture Capital Trusts can offer significant tax breaks. But this type of investment is not for the faint hearted and should only be considered if you are prepared to lose some or all of your capital if things go wrong.
…and another thing to think about:
Buying a New Car is about to get more expensive from 1 April when new Vehicle Excise Duty rates come into force due to a controversial Government overhaul that taxes even low emission vehicles. So if you are considering a car purchase it might be worth bringing forward your decision – depending on the type of car you have your eye on…