Given the current state of affairs, most of us have a lot more time on our hands. There are so many little chores which we have in the back of our minds but we seem to never have the time to get these done. Being it tidying up your home office, fixing up those unattended spreadsheets or attending to your tax allowances to maximise your tax savings. Now is the time GET THINGS DONE. This is a reminder to maximise your allowances as early as possible in the new upcoming tax year starting 6th April 2020.
The maximum you can contribute to an ISA for next tax year is £20,000. This is a very tax-efficient investment vehicle set up a goal for Monthly Contributions to reach the maximum you can afford.
Another way to reduce tax and at the same time boost your retirement pot is to make sure you use up your entire annual pension allowance, which is £40,000 for 20/21. Additional rate taxpayers enjoy tax relief of 45%. If your total pension savings exceed the lifetime allowance of £1.073 million in 2019/20, you may be liable to tax when you draw benefits. Once you earn more than £200,000, your annual allowance starts to fall, known as the ‘tapered annual allowance’. The tapered allowance applies if your ‘adjusted income’ is more than £200,000
Everyone is able to gift £3,000 to someone and it will be immediately outside of your estate for inheritance tax. You can top this up to £6,000 if you didn’t use the allowance in the previous tax year too.
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