With the Prime Minister’s surprise announcement of a general election on 4 July, attention is shifting towards the financial policies of the main parties and their implications. Taxation remains a critical battleground, especially given the current peak levels of taxation, which will undoubtedly feature prominently throughout the upcoming campaign.
It is currently at the mid-point of the latest extension to the tax-threshold freeze schedule, set to last until 2027/28, along with cuts to reliefs and allowances. These measures have been eroding individual wealth and increasing the number of higher-rate taxpayers.
Despite the beginning of the 2024/25 tax year seeing inflation return to within 1.5 percentage points of the Bank of England’s 2% target from its double-digit high in 2022, achieving that target remains stubbornly elusive. With the May inflation figure hovering at 2.3%, the anticipated cut to interest rates in early summer seems increasingly unlikely.
While the uncertainty around the election date has been resolved, the outcomes of either a new Labour government or a continued Conservative one emphasise the importance of taking advantage of all available tax reliefs and allowances while their impacts are clear.
Throughout the tax year, individuals should consider reviewing their position regarding the higher income child benefit charge, maximising the benefits of the newly loosened ISA savings rules, and contemplating whether the removal of tax advantages for furnished holiday lets planned for next year means exploring alternative income sources in 2024/25.
SMH Financial Services, leading Financial Advisers based in Sheffield produce an annual Tax Planning Tips, updated for 2024/25, which cover a comprehensive range of strategies to help manage tax planning across personal and family planning, savings and investments, property, retirement, estate planning, business, and employment.
With practical examples and hints, the guide offers useful advice to help you make more effective tax planning decisions and minimise your tax liabilities. SMH Financial Services provide strategies for employers whose staff are feeling the pinch due to rising inflation, those working multiple jobs, individuals approaching retirement, and anyone undertaking estate planning.
Please get in touch to discuss any issues that may affect you. For further information on any of the topics above and to view the full set of updated Tax Tips, download the PDF.
Download our 2024/25 Tax Planning Tips here.
