As we approach the end of the 2019-20 tax year, now is an opportune time to take stock of your finances and consider how you might wish to adjust your planning for the new tax year which begins on 6 April.
Effective tax planning can result in considerable benefits for you and your business, where various means of maximising allowances and minimising liabilities are examined across a broad spectrum of taxation. This is particularly pertinent in light of the annual changes to many of these taxes and allowances, as announced in the Chancellor’s Budget each year.
Many SME businesses could benefit from the potential tax savings that come with the right planning. Areas that could be examined include remuneration packages, the extraction of profits, dividend planning and options around additional pension contributions. Business owners may also look at different options when it comes to their workforce. Whether there are 2 employees or 200 employees, a myriad of employee benefit schemes are available.
Limited company owners need to understand how any changes in corporation tax and capital allowances rules may impact their tax liability. They may also need to consider if they undertake any research and development work as they could benefit from making a Research and Development tax credit claim.
From an individual’s perspective they may wish to look at pension and Gift Aid contributions, investing in tax advantaged schemes or using a transferable personal allowance to reduce their tax liability. They should also regularly review their inheritance tax and capital gains tax situation depending on their personal circumstances.
This is only a snapshot of some of the key considerations for any business owner preparing for the 2020-21 tax year. Many businesses will differ in terms of their own circumstances and trading environments, but all businesses can benefit from diligent tax planning that leads to enhanced cashflow and profitability.
For information on how GMcG’s Tax team can assist with your tax planning, contact:
Belfast - Lyn Canning Hagan 028 9031 1113
Lisburn - Christine Harrison 028 9260 7355
Portadown - Neil Armstrong 028 3833 2801.
A Tax Tips presentation will be delivered by GMcG in association with Lisburn Chamber of Commerce on April 29th at Lisburn Enterprise Organisation. To register to attend, please email office@lisburnchamber.co.uk
