Aaron Abraham IFA Harpenden – Use ISA and pension allowances this tax year

Thursday 8 March, 2018

Aaron Abraham, Independent Financial Adviser (IFA) in the Harpenden financial planning team recommends you review your financial planning ahead of the new tax year to ensure you use up all your pension and ISA allowances. 

Aaron Abraham, Independent Financial Adviser in Harpenden, offers independent financial advice to clients in Harpenden Hertfordshire, central London and Wimbledon.  Aaron is a qualified financial adviser and his specialist interests include millennial financial planning.  His offshore experience also allows him to offer financial advice to other returning expats.

Aaron Abraham, independent financial adviser and member of the Harpenden financial planning team said:

‘We recommend that as the new tax year approaches it is worth reviewing your financial planning and consider all your allowances to ensure that you have used any that are available to you.  You can invest the whole of your individual ISA allowance of £20,000 in a Stocks & Shares ISA before April 6th 2018, or up to £20,000 in a cash ISA, with any balance invested in a Stocks and Shares ISA. A couple can now invest £40,000 in tax efficient investments before April 6th 2018. Investing your ISA allowance maybe beneficial as future withdrawals from an ISA are not subject to capital gains tax or income tax.  Consequently ISA investments should be viewed within the overall context of your financial planning and retirement planning strategy as they can reduce the overall amount of tax you will pay in retirement. Remember that if you have children under 18 who does not have a Child Trust Fund you should be eligible to open a junior ISA for them worth £4.128 in the April 2017/18 tax year.’ 

Aaron Abraham, independent financial adviser Harpenden continued:

’We also recommend that anyone who is a UK taxpayer review their pension allowances.  In the 2017-18 tax year the normal rule is that you will be able to claim tax relief on pension contributions up to 100% of your earnings or an annual allowance of £40,000, whichever is the lower figure. As an example if you earn £30,000 but put £35,000 into your pension pot you would only receive tax relief on the £30,000. Remember you can carry forward unused pension allowances from the last three years, if you were a member of a pension scheme during that time.  From 6 April 2016, individuals who had ‘adjusted income’ (total taxable income including all pension contributions) for a tax year of greater than £150,000 had their standard annual allowance (£40,000) for that tax year restricted.   The restriction works such that for every £2 of income they had earned above £150,000, their annual allowance was reduced by £1. The maximum reduction was £30,000, so the annual allowance for anyone with income of £210,000 or more would be £40,000-£30,000 = £10,000.   For more information please read - Richard Porter, IFA St Albans - Pension allowances explained for high earners.  Personal pensions allow contributions to be made by, or for, all UK residents, including children and grandchildren.  A net contribution of £2,880 (effectively £3,600 gross) each year can be made to members of your family even if they do not have any earnings or do not work.  For example you could set up a pension scheme for your children on their behalf.’

Aaron Abraham, IFA Harpenden continued: ‘Our Lonsdale Wealth Management financial advisers recommend that our clients have regular financial planning reviews to ensure they tax plan efficiently and use up all their available pension allowances and ISA allowances.  Our independent financial advisers offer pension advice and investment advice based on your personal circumstances.  It is never too late to start planning for your future and getting financial advice just before the new tax year is a good time to start.  If you are looking for independent financial advice contact us, or call me on 01582 466900 for a free initial consultation.  

Please note:  The value of investments can fall as well as rise. You may not get back what you invest.  The Financial Conduct Authority does not regulate Tax advice, Estate planning or offshore investments.

For more information review our Pension Planning information and Investment Planning Information.  Read:  Richard Porter, independent financial adviser St Albans – When to keep your defined benefit pension scheme; Richard Porter, independent financial adviser St Albans – Get pension advice at retirement; Deb Nolan independent financial adviser Leeds / Bradford – Will you have enough  retirement income?

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