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The End is Nigh… well the end of the tax year that is

Business, Financial Planning, Investments, ISA, Pensions, Savings, Tax Planning
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The End is Nigh… well the end of the tax year that is

Last minute tax planning is less than ideal but it’s better than no tax planning.  Every year we all get our tax allowances and every year we get the same warning before April 5th… use it or lose it.

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What are the tax allowances for this year?

I’m going to limit this post to the main two tax allowances, Pensions and ISAs. Simply because for most of the population these are more than enough to cover our financial planning needs.

ISA Allowances 2013/14 & 2014/15

Up to the 5th April 2014 you can invest up to £11,520 in ISAs of which £5,760 can be invested in a Cash ISA. Remember there is now carry forward of unused allowances with ISAs.  From 6th April your annual ISA allowance will increase to £11,880 with a maximum of £5,940 in cash.

For those who have a little more to invest and want to create a fund for their child there are allowance for Junior ISAs and Child Trust Funds as detailed in the table below.

2013-14

2014-15

Individual Savings Account (ISA) subscription limit
   Overall limit  £        11,520  £        11,880
   of which cash  £          5,760  £          5,940
   of which stocks and shares  £        11,520  £        11,880
Junior ISA subscription limit  £          3,720  £          3,840
Child Trust Fund (CTF) subscription limit  £          3,720  £          3,840

Pension Allowances 2013/14 & 2014/15

Up to the 5th April 2014 you can invest up to the lower of 100% of your gross earnings or £50,000 in a registered pension scheme.  From 6th April your annual pension allowance will reduce to £40,000 however carry forward is allowed under certain rules.

Although it won’t affect most of us it’s important to remember that there is a lifetime allowance to consider.  This is being reduced from £1.5m to £1.25m from 6th April 2014.

Again for those with a little more to invest there are children’s allowances available.

Beware the Tax Dog

Remember that just because it is tax efficient doesn’t necessarily mean it’s the most suitable investment for you or your objectives.  Think carefully about what you want to achieve before making any investment.  Obviously as a Financial Planner I am going to recommend getting advice but if you are in any doubt on how to proceed then get in touch on 02895 815000.

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About Ciaran Scullion

I am a Financial Planner and Mortgage Adviser. I provide Independent Financial Advice through my company From Acorns Financial Planning Ltd to personal and business clients throughout Northern Ireland from my base in Tyrone, Mid Ulster.

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