With the New Year commencing on 6 April, here are some things to start planning now.

Pension Contributions

Contributing to your pension is one of the most straightforward and effective ways to save on your tax bill.  The money in your pension is sheltered from savings or capital gains tax. What you contribute to your pension will benefit from income tax relief.

Tax-Free Childcare

All families have to do is pay into their Tax-Free Childcare account, and for every £8 that they deposit, the UK Government immediately makes a top-up payment of an additional £2. The scheme is open to working parents, including the self-employed, who earn between the minimum wage and £100,000 per year and have children aged 0-11 years old. Families with a disabled child, aged 0-17 years old, can receive up to £4,000 in government support each year.

Families in Scotland can choose from childcare providers that have signed up to Tax-Free Childcare, including nannies, nurseries, childminders or after-school clubs.

Combining Allowances with your Partner

Each person has an ISA allowance of £20,000 per year, keeping investments and cash safe from tax. If you share finances with your partner, you can essentially double that allowance by using up both your own and your partner’s allowance.

Couples can also transfer assets between them to make full use of their allowances. For example, a basic-rate taxpayer would pay a lower rate of tax for capital gains, income and dividend taxes, so if one partner is in this bracket, it can mean less money lost to tax if those investments are held in their name.

However, remember that once you transfer the money to your partner, it is legally theirs. So, even in the case of divorce, you would not have an automatic claim to those funds. While it can be a great way to save, it is essential to be aware and comfortable with your partner having ownership of these funds.