Tax looms large in an election year
With the Prime Minister’s surprise announcement of a general election date of 4 July, attention will shift towards the financial policies of the main parties and their implications. Tax is a key battleground as ever, with the current peak levels of taxation inevitably featuring across the forthcoming campaign. We are at the mid-point of latest extension to the tax-threshold freeze schedule, set to last until 2027/28, coupled with cuts to reliefs and allowances. The consequences have been eroding individual wealth and increased numbers of higher rate taxpayers.
While the beginning of the 2024/25 tax year saw inflation back to within 1.5 percentage points of the Bank of England’s 2% target, from its double-digit high in 2022, that target is proving stubbornly elusive. With the May inflation figure hovering at 2.3%, the likelihood of an anticipated cut to interest rates in early summer may be receding.
Although the uncertainty around an election date has now been removed, the outcomes of either a new Labour government or continued Conservative one mean taking advantage of all your available tax reliefs and allowances while their impacts are clear.
Across the tax year you could, for example, review your position regarding the higher income child benefit charge, make the most of the newly loosened ISA savings rules and think about whether the removal of tax advantages enjoyed by furnished holiday lets planned for next year means 2024/25 should be the year you look elsewhere for income.
In our annual Tax Planning Tips updated for 2024/25, we cover a range of strategies to help you manage your tax planning across personal and family planning, savings and investments, property, retirement, estate planning, business and employment.
With worked examples and hints, you’ll find useful guidance to help you make more effective tax planning decisions and minimise your tax liabilities. We offer strategies to employers whose staff are feeling the pinch due to the rise in inflation, those working two jobs, those looking towards retirement and anyone undertaking estate planning.
Please get in touch to discuss any issues that you think may affect you. For further information on any of the topics above and to view our full set of updated Tax Tips, download the PDF.
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