Hi, I’m Judith Fraser, Head of Customer Marketing at Standard Life. I’m passionate about helping you plan for a brighter financial future.
The end of the tax year is fast approaching, so now’s the perfect time to review your pension and savings and make the most of this year’s tax relief opportunities, before time runs out.
Here are three simple actions you can take today to make sure you don’t miss out.
Most people can save sixty thousand pounds into their pensions each year before they have to pay tax. This is known as your pension annual allowance.
But did you know you can carry forward any unused pension annual allowances from the previous three tax years? This could help you make the most of valuable tax relief — especially if you have fluctuating income or a one-off bonus.
If you’re saving into an ISA, remember that your annual allowance doesn’t roll over, unlike your pension annual allowance. So it’s a good idea to max out your twenty thousand pounds allowance by the fifth of April if you can.
If you pay into a personal pension—one you’ve set up yourself or through an employer—you’ll get tax relief on your contributions.
For basic-rate taxpayers, twenty percent tax relief is added automatically.
If you’re a higher-rate taxpayer, you’ll need to claim the extra twenty percent through a self-assessment each tax year to make sure your pension gets the full boost.
This doesn’t apply to most workplace schemes where tax relief is handled for you, so check which type of pension you have.
Higher-rate taxpayers can also claim extra tax relief on charitable donations made through Gift Aid.
The end of the tax year is a great time to review your finances and think about your long-term goals. Even small steps now can make a big difference later.
If your budget allows, you could make a one-off payment into your pension plan to give your retirement savings a boost. Over time, this could grow thanks to investment returns, meaning your money has the potential to be worth more when you retire.
Check with your pension provider—usually online or by phone—for details on how to make a one-off payment and whether any deadlines apply.
