Tax and Financial Planning Tips

Pro-active financial planning and tax planning tips for your firm - and for you personally


We can all get tied up in our day jobs, particularly in difficult times as many of us have experienced during the pandemic.  As advisors, we like to have conversations with our clients about longer term objectives such as wealth creation, retirement/exit etc.  It’s important to sit back and take stock of where you are against your life objectives and goals to see what steps you could take to more pro-actively manage your affairs. 

In this article, we look at some of the areas that, subject to your own specific circumstances, objectives and goals, you may wish to consider in terms of your business and, potentially just as importantly, your personal financial and tax affairs.

Both financial advice and tax planning is subject to individual circumstances and all the options and allowances, either collectively or individually, highlighted within this article are not suitable for everyone.

Income/capital gains

  • If your taxable income passes the thresholds of £50k, £100k or £150k, your tax rates are likely to increase and you may lose some/all of your personal allowance.  Pre tax year end planning can help here, particularly if income can be deferred/allocated to spouses, or if expenditure can be advanced or pension contributions made.
  • Undertake remuneration/profit extraction planning.  This can include making use of the £2k dividend allowance and interest income allowance/lower rates.  It can also ensure an effective mix of salary, dividend, interest and pensions/other benefits.
  • Think about pension contributions to reduce your personal tax and have the government top-up your pension pot via tax relief, including making use of any carry back allowance.
  • Consideration of Self Invested Personal Pensions, particularly where linked to investments such as property ownership.
  • If applicable, make effective use of your Capital Gains Tax allowance between family members and timing between tax years.

Inheritance tax

  • Consider setting up trusts for asset protection and moving items outside estates.
  • Make use of the £3k annual gifts allowance for family members.
  • Don’t forget that higher gifts can also be made out of income in addition to the £3k allowance.

Investments – personal or business

  • Have effective use of ISAs – with the current low interest rate on cash ISAs, is it appropriate to move some funds to a stocks and shares ISA or consider ISA transfers?
  • What will be the impact on you if we have negative interest rates?
  • Consider lifetime ISAs where the government will top up £4k annual contributions by £1k.
  • Is it appropriate to review the structure of your property partnerships now that they are no longer as tax efficient as they once were?
  • Have you made all of the Research and Development (R&D) tax credit claims that you are entitled to?  This covers much more innovation than you may imagine.
  • Can you make use of Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) investments for personal tax relief and tax efficient income?
  • Have you made full use of the enhanced £1m Annual Investment Allowance for Capital Allowances on business investments?
  • If you are renovating your business property, have you analysed all of the expenditure to ensure capital allowance claims are maximised?


  • What would happen to the business or your family if something happened to you or a key person?
  • Have you got shareholder or partnership protection in place?

Exit/Retirement planning

  • Think early about who to sell to/how this will be achieved.
  • Many find it helpful to prepare a stress-tested personal cashflow forecast through to retirement and beyond, to check what level of funds will be required and the date retirement can be achieved.
  • Will Employee Ownership Trusts provide a tax efficient exit route for you?
  • Will you look to provide funds for a disposal out of post deal trade?  Can that be structured tax efficiently as a Vendor Initiated Management Buy Out?
  • Check you meet the criteria for Business Asset Disposal Relief, particularly in terms of trading, ownership and positions.

We’re always happy to meet with existing clients and potential new clients to discuss their financial and tax planning and so if you would like any further detail on any of the above, or would like to take the opportunity to have some detailed life planning discussions with us, please do get in touch.  We’d love to have a “with our compliments” no-obligation conversation with you.

Article written by Justin Rourke, Senior Financial Planning Manager and Graham Poles, Tax Partner.

Armstrong Watson have both Financial Planning and Tax Consultancy expertise “all under one roof”. This allows us to provide bespoke and personalised financial planning and specialist tax advice to our clients. We always ensure we have a full understanding of your circumstances and objectives before providing any advice.

For financial planning and tax advice, please get in touch with one of our consultants near you on 0808 144 5575 or email

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