Whilst it feels like 2023 has only just started, we are actually less than 11 weeks from the end of the tax year. Below are 5 tips to get ahead with your planning and continue to build for your future.

Pension contributions

With tax rates increasing it makes more sense than ever to put excess income and profits into a pension and build for your future. As a reminder headline corporation tax rates are increasing to 25% from April 2023 so any pension contributions made could reduce the company tax by a significant sum.

Where you are a member of your employers pension scheme, see if you can switch to salary sacrifice for any pension contributions. This could have the effect of saving you National Insurance on your contributions meaning for the same contribution your take home pay can increase.

ISA allowances

ISAs are the next place to go with surplus income and capital. Each year UK adults have an ISA allowance of £20,000 which is lost if not used. Money within an ISA grows free from tax and any withdrawals are tax free. An ISA can be cash or investment linked and over time it is possible to build up a healthy ISA pot to provide for future capital or income needs.

For those under 40 please also keep in mind LISAs as these provide some additional tax relief from HMRC and can be very beneficial for first time buyers of houses.

Ensure your Will is up to date

This morning we had the really sad news that one of our clients has passed away. The client was only 59 and leaves behind a partner and two adult children. The individuals will is over 10 years out of date and already there is some confusion about the content and how the estate will be split. If you haven’t reviewed this recently, please do so as we never know what the future may hold.

Review your life cover

Similar to point 3 above, it is important that your life cover is regularly reviewed to ensure it remains suitable for your situation. Life is ever changing and what was right in the past may no longer be suitable going forwards.

For business owners, it is possible to provide some life cover options through your company more tax efficiently. Any review should look at this and see if not only that the cover is sufficient in terms of sum assured and term but also are you paying for it in the most efficient way possible.

Risk appetite

2022 was a turbulent year in many markets and now is a good time to review your risk appetite and ensure it meets your views and perhaps more importantly your needs for the future. In my experience risk requirement is something that is often overlooked as part of the investment mix discussion. What I mean here is ‘What level of risk is required to meet my future needs?’.

Cash rates in particular have picked up in recent months and we come across many people who seem excited by 3% to 4% interest from a bank account. However, will this keep pace with inflation over the medium to long term? Our view is highly unlikely.

Each asset our clients own is owned for a reason and to achieve an objective. Perhaps time to do the same thinking with your assets?

11 weeks may feel like a long time, but it will soon be upon us. So time to get cracking and ensure your planning is up to date well in advance of April.

Thanks for reading.