Tax Planning Tips 2014/15

Are you ready for the end of the tax year?

end of year tax planning with Lewis Smith & CoIt’s very close to the end of the 2014/15 tax year which falls on Sunday April 5th.

Time to consider some smart tax planning moves to minimise your tax exposure.

Here are just a few ideas for you to ponder:

CGT Annual Exemption
Individuals have an annual exemption, currently £11,000, which can be set against capital gains from the sale of assets.

You can maximise the effectiveness of the exemption in a couple of ways.  Firstly by transferring assets between spouses or civil partners to use both parties exemption and secondly by staggering capital disposals between this tax year and the next.  In both cases the transaction should be genuine and outright.

The annual ISA allowance for individuals increased to £15,000 in 2014, and that figure includes both cash and equity based ISAs.

Now is a good time to take advantage of tax free income and capital gains by topping your investment up to the maximum  or re-balancing the mix of cash and shares.

Pension Contributions
If you are under 75 then you qualify for income tax relief at your marginal tax rate on pension contributions up to a gross annual maximum of £40,000.

One other aspect of pensions that people sometimes forget is that you can carry forward unused allowances from the previous 3 years.

High Income Child Benefit Charge
Child benefit can now be clawed back if adjusted net income for the tax year is greater than £50,000. In the case of spouses and civil partners who are living together then the higher earner (whether or not they are both over £50,000 threshold) will be liable for the charge.

Couples can avoid the charge by planning their tax affairs to keep them both below the threshold.  This can be achieved in a variety of ways depending on the sources of income but asset transfers, pension contributions and gift aid donations can all be used.

These are just some of the basic approaches to effective tax planning.  You might also want to arrange to talk to Lewis Smith & Co. about SEIS and EIS shares (Seed Enterprise Investment Schemes and Enterprise Investment Schemes respectively), Venture Capital Trusts, Inheritance Tax, Buy To Let tax strategies or Salary Sacrifice schemes.

Simply give us a call on 01384 235549 or email for a free and confidential discussion of your needs.


Lewis Smith & Co. – Accountants for West Bromwich businesses