With tax year end just around the corner, it’s time to check you are making the most of your tax reliefs and allowances to save for a brighter future. You may want to consider:

Bonds: cash in bonds to use up Personal Allowance/starting rate band/Personal Savings Allowance and basic rate band

  • If you have unused allowances that can be used against savings income, such as personal allowance, starting rate band or the personal savings allowance, now could be an ideal opportunity to cash in offshore bonds, as gains can be offset against all of these.
  • If not needed, proceeds can be re-invested into another investment, effectively re-basing the ‘cost’ and reducing future taxable gains.
  • For those that have no other income at all in a tax year, gains of up to £17,850 can be taken tax free.
  • If you have any of these allowances available, but your partner (or even an adult child) does, then bonds or bond segments can be assigned to them so that they can benefit from tax free gains. Remember, the assignment of a bond in this way is not a taxable event.

Key information

  • Details of all non-savings and savings income.
  • Investment gains on each policy segment.

Please be aware that the value of investments and the income derived from them can fall as well as rise and you may not get back what you invest. The Financial Conduct Authority does not regulate tax advice.

Summary

Effective tax planning is a year round job. It’s only at the end of the tax year that you have all the pieces to complete the planning jigsaw, but there are steps you can take now to get ahead of the game and give yourself time to put plans in place. And with less than 7 weeks until 6 April, there’s no time like the present to get started.