Perhaps some spring cleaning of personal finances before the end of the tax year 2024/2025
01 March 2025Spring seems to be in the air and thoughts of Easter, falling late this year in April, can help thoughts turn to a well-earned break, time with friends, a holiday, or otherwise. Much to plan for and to enjoy.
Before we get there, of course, we have the end of the tax year, falling on 05 April, to consider and perhaps some spring cleaning of personal finances to use up valuable tax allowances for you and your loved ones where available and affordable. Taking a broom round your personal finances on a regular basis is never a bad idea, even if no changes are made; at least you will know where you are, particularly when considering any plans that you have for the future. As we have noted on many occasions, each of us is different, with different objectives and aspirations, and staying on track with your money planning, either on your own or working with a financial planner, is never a bad thing.
With only a month or so left of the current tax year 2024/2025, what might you want to look at? Some of the headline allowances might be as follows for an individual.
|
Allowance |
Maximum amount |
Comment |
|
Individual Savings Account (ISA) |
£20,000 |
Stocks & shares, cash, or a combination to the maximum |
|
Junior Individual Savings Account (ISA) |
£9,000 |
Up to age 18 Stocks & shares, cash |
|
Pension contribution annual allowance |
£60,000 gross max from all sources |
Could be more or less, dependent on your individual circumstances Check your annual earnings carefully |
|
Capital Gains Tax allowance |
£3,000 |
|
|
De minimis pension contribution limit |
£3,600 gross |
Up to age 75 / paid net at £2,880 |
|
Inheritance Tax gift allowance |
£3,000 |
You can also reach back one year if gifting was not used in the tax year 2023/2024 |
In our experience, some use a combination of allowances over the tax year with the aim of getting the most from their financial assets. It is also important to remember that most personal allowances are restored in the new tax year 2025/ 2026 and you may decide to use these early, again in the spring months post 06 April.
State Pension top-up deadline / 05 April 2025
One important issue is that those that have the ability to top up the State Pension have a window to fill in any missing years in their record from April 2006. The final extension to the timeline was extended to 05 April 2025, and we do not see this changing any further. Action now might be appropriate if needed, so please do check your position soon.
Summary
We hope you enjoy your spring cleaning of your personal finances and please do talk to us about any thoughts that you have for your pension planning, along with other arrangements, such as investments and ISAs, as we approach the end of the tax year.
Please take suitable financial / accountancy advice for your individual circumstances before implementing any changes to your arrangements
We hope these notes are helpful and we look forward to helping you with your financial planning over the remainder of this tax year and into the future.
Keith Churchouse FPFS
Director
CFP Chartered FCSI
Chartered Financial Planner
Chapters Financial Limited is authorised and regulated by the Financial Conduct Authority, number 402899
