Welcome to the first of our ‘Money Matters’ columns, brought to you in association with Peter Harding Wealth Management.

This month Peter Harding, Chartered Financial Planner, discusses how using your allowances and reliefs before April 5 can lay the foundations for your financial future.

We also get to meet Operations Director, Clair Smith, and learn about her former football passion.

• peterhardingwm.co.uk

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Using your allowances and reliefs before April 5

This year more than ever, making the most of your 2022/23 annual allowances and tax reliefs before tax-year end is one of the most practical steps you can take to tackle those tax rises, and bring your tax bill down.

No matter what your personal circumstances are, this cost of living crisis is beginning to bite. Although some of us may have more of a buffer against rising inflation, energy bills and interest-rates, the longer-term impact on our financial wellbeing is making for sleepless nights.

Using up your personal allowances helps to make the most of your investments, meet your outgoings, and lays the right foundations for your financial future.

These are the ‘big four’ personal allowances not to miss out on:

1. Your £20,000 ISA allowance – This year, the ISA tax-efficient allowance is still £20,000, so it makes sense to put away as much as you can afford, since you don’t pay Income Tax or Capital Gains Tax on any interest you earn. Top up your ISAs before the end of the tax year or you’ll miss out on this tax-efficient opportunity. Opening a Junior ISA means you can save up to £9,000 tax-efficient for your children or grandchildren. It’s a lovely way to get them off to a great start later down the line – and you reap the tax benefit now.

2. Your pension allowance – Using your full pension allowance – up to £40,000 in a single tax year, or 100% of your earned income, whichever is lower – can make a big impact on your financial wellbeing in later life. If you’re over the additional taxpayer threshold, a timely pension contribution before tax-year end can bring you back down below the threshold again. The other good news is that HMRC will let you carry forward any unused allowances from the three previous tax years – starting with the earliest tax year first. So, top up your pension before 5th April if you can afford to.

3. Your £3,000 gifting allowance – We all want to pass as much of our money and assets on to our loved ones rather than HMRC. Using your annual tax-free gifting allowance of £3,000 means that you’re reducing the overall value of your estate when it comes to the final tally of Inheritance Tax or IHT. Even if you give away more than that, the amount will become IHT exempt if you survive for seven years. Plus, it’s back datable. You can carry the allowance over for one tax year, meaning you could give away up to £6,000.

4. Your Capital Gains Tax allowance – If you’re planning to sell investments or assets, the changes to Capital Gains Tax or CGT this year are particularly relevant to you. This is the last year that you’ll be able to claim the full £12,300 CGT allowance, which is the amount you can make before you start paying tax. It’ll drop to £6,000 in 2023/24, and then to £3,000 from April 2024. If you’re going to sell any property or high-ticket assets, you’ll probably want to talk through your plans with a Financial Adviser.

Making the most of every tax-saving allowance or tax relief allowance that’s on offer lays some solid foundations for your financial future. With so many other aspects of our lives changing on an almost daily basis, it’s good to know that you can do something practical to help your short and long-term financial wellbeing.

If you would like some more information on this topic, please do not hesitate to contact Peter on 01747 855554 and email [email protected].

The value of an investment with St. James’s Place will link directly to the performance of the funds selected and may fall as well as rise. You may get back less than you invest. An investment in equities does not provide the security of capital associated with a bank deposit account.

The levels and bases of taxation, and reliefs from taxation, can change at any time and are generally dependent on individual circumstances.

Any tax relief over the basic rate on pension contributions is claimed via your annual tax return.

Peter Harding Wealth Management is an Appointed Representative of and represents only St. James’s Place Wealth Management plc (which is authorised and regulated by the Financial Conduct Authority).

Peter Harding Wealth Management is a trading name of Peter Harding Practice Ltd.

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Getting to know our team.

Name: Clair Smith.

Role: Operations Director.

Time at Peter Harding Wealth Management: 6 years.

What’s the best bit about your job?

Working with a great team of people with the same goal of delivering superior service to clients. My job is also very varied, which keeps it interesting.

If you weren’t doing this role, what might you be doing?

Travelling the world and exploring, so perhaps a travel guide.

What do you enjoy doing outside of work?

Anything active: running, walking and cycling. I also love holidaying and reading too.

Tell us something about yourself that we don’t know.

I played football from school age until the age of 21. Mostly for Salisbury Ladies FC but also a short time at Porton Ladies FC.

Who was your childhood hero?

Ooh as a young child – off the TV, Inspector Gadget or from books then Mildred from The Worst Witch.

What’s your favourite film?

Gosh there are so many. Dirty Dancing if I had to pick one.

What’s your favourite holiday destination?

That is a hard one, but I’d say Egypt, as the Red Sea is something else. Mexico is pretty cool too.

Give 3 words to describe yourself:

Active, straight-talking, optimistic.