There is only a month or so left until we reach the end of the tax year on 5 April and now is the perfect time for doctors and dentists to review and optimise their tax situation. It’s important to ensure you are utilising all available tax strategies now, since you will need some time to implement them before the end of the tax year. To learn about the key considerations for end of year tax planning, read on.
This does not constitute advice and advice should be sought in all instances before acting on it. The Financial Conduct Authority does not regulate tax advice.
Here are a few key strategies you should check in on at this point to ensure you’re maximising your tax-saving opportunities.
Maximise your ISAs
Individual Savings Accounts (ISAs) offer a tax-efficient way to grow your wealth. With a maximum annual allowance of £20,000, it’s crucial to contribute before the tax year ends since you can’t carry forward any unused balance. Both Cash ISAs and Stocks & Shares ISAs provide the same benefits of tax-free growth and income. If you aren’t already, consider diversifying your portfolio to balance risk and explore different asset classes, including a mix of ISAs.
Contribute to SIPPs for Retirement Planning
Another avenue to explore is Self-Invested Personal Pensions (SIPPs). Not only do they help secure your financial future, but they are also tax beneficial. Your contributions to your SIPP is eligible for tax relief, so be sure to fully utilise your £60,000 annual allowance this tax year.
Explore Inheritance Tax Planning
If you’re looking for additional ways to maximise tax savings, consider exploring inheritance tax planning strategies to safeguard your wealth for future generations. Be sure to utilise annual gift exemptions, set up trusts, and implement other tax-efficient methods to mitigate potential inheritance tax liabilities.
Like many other aspects of tax planning, IHT planning can get quite complicated, so we recommend seeking advice from financial professionals who specialise in the dental and medical field for a bespoke approach to planning.
Increase Charitable Donations
Charitable donations are great because you get to support a worthy cause but you also get some tax advantages as well. It allows you to pay less Income Tax by deducting the value of your donation from your total taxable income. Plus, donations made through the Gift Aid scheme enable charities to claim back 25p every time you donate £1, which increases the impact of your contribution. Before the tax year concludes, assess your charitable goals and make strategic donations to maximize both impact and tax benefits.
Marriage Allowance For Couples
In a partnership, if one partner earns less than the personal allowance, consider using the Marriage Allowance which allows the lower-earning partner to transfer a portion of their personal allowance to the higher-earning partner. Doing this has the ability to potentially reduce the overall tax liability for the household.
Work with a Financial Adviser
To be certain that you have fully maximised all possible tax savings, it requires professional guidance. Working with a financial adviser means that you have tailor-made tax strategies unique to your personal financial situation. With the end of the tax year quickly approaching, now is the time to act. Dental & Medical Financial Services specialise in assisting dental and medical professionals, offering a wealth of knowledge and expertise in maximising tax savings while building wealth for retirement and future generations. Time is ticking, so get in contact with us now to make the most of the rest of the tax year.