Year End Tax Planning 2023/24

As a new tax year approaches, it is important to ensure you are in the best financial position to help protect and grow your future wealth.

Our Bitesize Tax Planning provides you with details of the key allowances and reliefs available to you. The tax planning tips are available in easy to consider sections.

This article looks at Individual Savings Accounts (ISAs) including; Lifetime ISA and Junior ISAs.

ISAs

An ISA is a simple savings plan which offers tax-free interest and other income payments and tax-free capital gains. If you are planning to make the most of this year’s £20,000 ISA allowance, you need to use it before 5 April 2024. There’s no rollover from one tax year to the next.

Growth, income and withdrawals are not liable for income or capital gains tax, but the value of an ISA will form part of your estate for inheritance tax purposes.

There are four types of ISA:

  • Cash ISAs
  • Stocks and Shares ISAs
  • Innovative Finance ISAs
  • Lifetime ISAs
Lifetime ISA

As part of your £20,000 ISA allowance, it’s possible to invest up to £4,000 in a lifetime ISA which receives an annual government bonus of up to £1,000 per year.

You must be over 18 but under 40 years old to open a lifetime ISA, which can be used to buy a first home or fund retirement. Further scheme rules and early withdrawal penalties apply.

Junior ISA

Under-18s, or those who wish to save on behalf of a minor, can put up to £9,000 into a junior ISA for 2023/24.

There are 2 types of Junior ISA:

  • Cash JuniorISA – you will not pay tax on interest on the cash you save.
  • Stocks and shares JuniorISA – your cash is invested and you will not pay tax on any capital growth or dividends you receive.

More information on ISAs can be found here: https://www.gov.uk/individual-savings-accounts

If you would like to discuss anything mentioned in this article, please contact us.

Download our Tax Year End Checklist to assist with your tax planning below.

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See the other topics in our Bitesize Tax Planning series:
Personal Reliefs Savings & Investments
Planning for Retirement Research & Development Tax Reliefs

Personal circumstances differ and not all of this information is applicable to every client and/or their business, this information is general in nature and should not be relied upon without seeking specific professional financial advice.

The Financial Conduct Authority (FCA) does not regulate tax advice, estate planning, trusts or will writing.

The content in this article is for your general information and use only and is not intended to address your particular requirements. Articles should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice.

Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of any articles.

Thresholds, percentage rates and tax legislation may change in subsequent finance acts. Levels and bases of, and reliefs from, taxation are subject to change and their value depends on the individual circumstances of the investor. The value of your investments can go down as well as up and you may get back less than you invested. Past performance is not a reliable indicator of future results.

Pareto Financial Planning Limited is authorised and regulated by the Financial Conduct Authority (FCA).