Key Tax Allowances for a New Tax Year
As we enter the new year and the start of a new tax year is now on the horizon, it is a great time to have a look at some key tax allowances that you should consider utilising before they are reset after April 6th.
The annual limit for Individual Savings Accounts (ISAs) will remain at £20,000, which means you can input up to this amount across all ISA accounts for an individual.
Dividend allowances are halving in April from £2,000 in the current tax year to £1,000 in 2023/2024, and then halving again the following tax year to £500.
Capital Gains Tax allowances are also reducing after April 6th 2023, as they will fall from £12,300 in the current tax year to £6,000 in the 2023/2024 tax year. It could be worth speaking to an adviser to see if you can take advantage of these before the allowances decreases.
On the pension side, the annual allowance remains the lower of either your level of earned income, or £40,000. Another allowance that is always worth utilising where possible.