Rush for end of tax year

Don’t leave your financial planning to the end of the tax year


Although the current tax year doesn’t end until 5 April 2022, effective financial planning shouldn’t be a mad March rush. Starting your financial planning early in the year will give you a head start.

Often, as the end of the tax year is approaching, there are many financial commentators and institutions writing/advertising about how you should make sure you don’t lose your valuable tax allowances. The reasons being that they allow you to reduce your tax bill or use up an allowance that may otherwise be lost after the end of the tax year.  

However, those who have chosen to engage the support of a financial planner, are much more likely to be in a position where they have looked and planned ahead, rather than waiting until the final weeks of the tax year to make last minute decisions

There are a number of areas of financial planning to consider that can benefit you both now and in the longer term, all of which are worthy of consideration. Key areas to look at include:

  • Pension contributions – maximising your allowance in the current tax year and in previous years to avoid losing any unused allowances
  • ISA Allowances – maximising your annual tax-free allowance - currently £20,000 per person per year. It is lost if you don’t use it
  • Capital Gains Tax – effectively using up any allowances and reliefs from your portfolios
  • Inheritance Tax – using up small exemption allowances but also making gifts and disposals in the current tax year
  • Income tax planning – reducing your income tax bill for high earners and those who receive child tax credit
  • Marriage Allowance - allows you to transfer a portion of your Personal Allowance to your husband, wife, or civil partner.

Each area needs careful thought as both financial and tax planning is subject to individual circumstances and all the options and allowances mentioned are not suitable for everyone. They should also be considered as part of someone’s overall financial plan and strategy i.e., part of a joined up and well thought through approach.

To try and “cram it in“ to the final few weeks of the tax year could mean that something is not considered and could potentially work against your overall goals and objectives.

Aside from making full use of available allowances and reliefs there are other advantages to planning ahead, for example, by using your ISA allowance or making your pension contributions earlier you could benefit from extra potential growth, as well as receiving an element of your tax relief earlier on your pension and any pension contributions. Of course, there’s also the benefit of spreading your contributions over a tax year instead of in one lump sum at the end, when it might not be affordable to you at that time.

Planning ahead is essentially what financial planning is all about, but by working with a trusted adviser, you also benefit from being kept up to date on the latest position on all aspects of relevant tax legislation which can then be signposted for both current and also future consideration.

Armstrong Watson have both Financial Planning and Tax Consultancy expertise in place “all under one roof”. This allows us to provide both a bespoke and joined up service for our clients when and where specific needs arise. Please note, some of the areas such as making pension contributions are provided by our Financial Planning Consultants, whereas other areas such as capital gains tax advice are services offered by our Tax Consultants within this article. Advice on IHT issues could be provided by a mixture of the two services.

For help and support with your financial planning contact Justin Rourke on 01768 222030 or email for a complimentary initial consultation.

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