The end of the tax year is fast approaching and it is now the time to make sure you have used all your tax allowances before it is too late. The personal allowance, capital gains tax allowance and annual investment allowances are all either use them or lose them allowances, you cannot carry them forward to the next tax year.
You must ensure you have brought your bookkeeping records up to date to accurately assess the businesses financial position before making these decisions regarding future requirements. If you do not have up to date bookkeeping records you may not know the businesses profit and this will have a bearing on the decisions you are going to make.
If your profit is above the personal allowance level you should be looking for ways to bring this profit level down, and some such options are assessing that the full amount of mileage allowance has been claimed for business travel in your privately owned vehicle if you use your own vehicle for business purposes, ensure you have put all your expense claims through the business for privately incurred expenses that are an expense of the business.
When you consider capital gains tax you need to evaluate if there are any sales of capital gains assets that are chargeable to capital gains tax that you intend to make, if the chargeable gains from these are going to be a higher profit than the capital gains allowance then can you split the sale of the assets so that you can sell some of the assets in this tax year and some in the next tax year this will allow you to take advantage of both years allowances.
Annual Investment Allowance is designed to allow qualifying businesses a deduction of one hundred percent of the purchase of qualifying assets, this means if you make such a purchase before the end of the tax year you will be able to claim the full cost as a tax allowable expense this tax year, on the other hand if you have used all your annual investment allowance in this tax year then you may wish to delay the proposed purchase into the next tax year.
Good bookkeeping records and cash-flow planning are vital if you are considering your tax planning in this manner. It is surprising how many small business owners do not keep the bookkeeping up to date and free bookkeeping training is available for those that cannot compile their own bookkeeping records.