Why You Should Prioritise Tax Planning Before 5 April

by | Jan 27, 2025

As the UK tax year-end approaches on 5 April, now is the perfect time to review your finances and take advantage of tax planning opportunities. Whether you’re self-employed or running a business, proactive tax planning can help you:

  • Reduce tax liabilities
  • Boost cash flow
  • Strengthen your financial position

Let’s explore a few key areas to consider before the tax year ends.

1. Maximise Your Capital Allowances

If your business has invested in equipment, vehicles, or machinery, you could benefit from the Annual Investment Allowance (AIA). This allows businesses to claim 100% tax relief on qualifying purchases, making it an excellent way to reduce your taxable profit. Reviewing planned or recent purchases before 5 April ensures you don’t miss out on this valuable deduction.

2. Boost Tax Efficiency with Pension Contributions

Making contributions to employee or director pensions is a smart way to lower your taxable profit. This not only provides tax relief but also demonstrates your commitment to employee welfare, fostering loyalty and motivation. Ensure these contributions are made before the deadline to maximise your savings.

3. Claim Tax Relief for R&D Activities

If your business has been involved in innovation, you may qualify for Research and Development (R&D) Tax Relief. This scheme offers significant tax credits for companies engaged in activities like developing new products, services, or processes. Many businesses overlook this opportunity, so it’s worth exploring if your projects are eligible.

Don’t Leave It Too Late

Proactive tax planning now can prevent unnecessary stress later and help uncover ways to improve your bottom line. From capital allowances to pension contributions and R&D tax credits, there are several opportunities to optimise your financial position before the tax year ends.

Contact us today to discuss how we can support you with your tax planning before the 5 April deadline!