Preparing for the Year End: Tax Planning Essentials

As your year-end approaches, tax planning doesn’t need to feel overwhelming. By reviewing your position before the year end, you can reduce the stress of compliance and put plans in place that benefit your business both now and in the future.

A stronger tax position and improved cash flow can help your business thrive, creating capacity for reinvestment and supporting long-term financial goals, including future remuneration.

Key areas to consider

When reviewing your position ahead of the year end, there are several key areas worth considering:

Taxable profits – If taxable profits for the year exceed £1.5 million (divided by associated companies) then HMRC require quarterly tax payments, which need to be budgeted for
Tax rate – Companies with profits below £50,000 (divided by associated companies) are taxed at 19% – could the business afford to increase spending to reduce tax?
Remuneration – Are you taking your remuneration in the most tax efficient way for you and your business?
Overdrawn loan accounts – Loan accounts can be a costly way of taking money out of the business and balances should be reduced wherever possible
Exit plan – Selling or passing on your business will have tax consequences including Capital Gains Tax and Inheritance Tax – have you considered your strategy?
Pensions – Employer contributions are deductible for Corporation Tax and are a tax-free benefit for all employees, including directors!
Tax efficient staff incentives – Providing your staff with tax-free or low tax benefits can be a great way to reward and retain staff
Allowances – Are all available allowances being claimed and utilised by you and your business such as the employment allowance, dividend allowance and savings allowance?

How we can help

Approaching your business and tax planning in a holistic way ahead of your year-end ensures you are fully prepared, compliant, and well-placed to maximise potential savings.

Our experienced and approachable team can help you identify opportunities for effective tax and business planning and support you in implementing the right strategies for your circumstances. If you would like to discuss your year-end planning and how the above might benefit you and your business, please get in touch to arrange a consultation. Megan.yorke@kirknewsholme.co.uk DD 0113 531 7325