End of tax year 2024/25
The 2024/25 tax year ends on 5th April. Now's your last chance make sure you take advantage of the tax incentives available to you. Below are a few areas to consider to make sure you don't miss out.
Using up your ISA allowances
You can invest up to £20,000 in the 2024/25 tax year and all future investment growth will be free from personal income tax and capital gains tax. There are a number of options including cash ISAs, stocks & shares ISAs and Lifetime ISAs. You can put all of the £20,000 in any one of them or split the allowance between them.
Lifetime ISA’s have an allowance of £4,000 annually.
Review existing cash ISA's
If you have a cash ISA, check if you're getting a good interest rate. But, before you switch to a better one, see if there are any fees for taking your money out early.
If you don't need all your ISA money in cash, you may want to consider moving some (or all) of it into a stocks-and-shares ISA. This move won't affect the £20,000 limit for new ISA money you can add this year. That £20,000 limit only applies to new money added into an ISA.
However, it is best to remember that stocks-and-shares ISAs aren't for money you might need soon. You should plan to keep your money in them for longer term, and remember that you could lose some of your investment."
Maximise your pension contributions
Another key tax-saving step you could take is maximising your personal pension contributions.
You can save as much as you like into as many registered pension schemes as you like and get tax relief on those contributions of up to your annual allowance each year, provided you pay the contribution before age 75.
Any contributions made before 5 April will attract basic rate tax relief within the pension scheme. If you’re eligible for higher-rate tax relief you can claim this through your self assessment tax return.
The annual allowance for tax relief in 2024/25 is 100% of your earnings (salary and other earned income) subject to a maximum of £60,000.
IHT and capital gains tax
You can gift away £3,000 per tax year which will fall outside of your estate and can also double this to use last years gifting allowance if you have not used it.
You can also make gains of up to £3,000 without incurring capital gains tax. If you are thinking of selling some assets there may be a benefit in doing so before 5 April.
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