As the 2023/24 tax year ends, it’s time to prepare your personal tax return. Here are key tips to help you stay organised, avoid errors, and reduce your tax bill.
1. Organise Your Documents
Collect key forms like your P60, P11D, self-employment income, dividend statements, and rental income details. Keep a checklist to ensure nothing is missed.
2. Maximise Allowances
Make use of the Personal Allowance (£12,570), Dividend Allowance (£1,000), and Capital Gains Tax Allowance (£6,000). Married couples can also take advantage of the Marriage Allowance to transfer part of their tax-free amount.
3. Boost Pension Contributions
You can claim tax relief on pension contributions, up to £60,000 or 100% of your earnings. Higher-rate taxpayers can claim extra relief through self-assessment.
4. Claim Eligible Expenses
Self-employed individuals should claim allowable expenses such as office costs, travel, and professional fees. Keep accurate records to maximise deductions.
5. Gift Aid Donations
Claim tax relief on Gift Aid donations. Higher-rate taxpayers can claim the difference between the basic and higher rates on these donations.
6. Review Rental Income
Declare rental income and claim eligible deductions like mortgage interest, repairs, and maintenance costs.
7. Watch Deadlines
Submit paper returns by 31 October 2024 and online returns by 31 January 2025. Payments are also due by 31 January 2025.
8. Plan Payments on Account
If self-employed, be ready for Payments on Account. You can apply to reduce these if your income has dropped.
Conclusion
Start early, stay organised, and take advantage of tax reliefs. Consider using a tax advisor if needed to ensure accuracy and reduce your tax bill.