As we approach the end of another tax year, it may be time to review your assets and consider utilising available tax allowances and potentially reduce future tax liabilities.
One tax planning tip is to consider using your capital gains tax annual allowance.
The current capital gains tax allowance for an individual in 2022/23 is £12,300. Total gains of less than this in the year are free of capital gains tax.
If you have assets/investments with gains, and have not already used your allowance, you may wish to consider selling or transferring these assets and crystalising a gain before the 5 April 2023 deadline.
If you have already realised capital gains in the year, you may also look to crystallise assets that may be standing at a capital loss to offset against these gains, or alternatively, carry any unused losses forward to use against future gains.
Acting now rather than delaying is more of an imperative because from 6 April 2023 (2023/24) the annual capital gains tax allowance is reduced to £6,000, falling to £3,000 in 2024/25.
Please note that this advice is given purely from a tax perspective and is not in any way investment advice. Therefore, if you are considering disposing of investments, you may also wish to discuss this with your financial advisor prior to any disposals.
Leanne Hickman
Director