Tax Planning Advice: 6 Smart Moves to Make Before the Tax Year Ends

As the end of the financial year draws nearer, it’s a good time to make sure your business finances are in shape. A few proactive steps now can reduce your tax bill, improve cash flow and position your business for the year ahead.

Here are 6 smart moves to help you get on the right track.

Please note, this article is designed to inform and educate, not to replace professional tax legal advice. For personalised guidance, always speak with a chartered accountant or qualified tax adviser before making financial decisions.

1. Understand Tax Deductions for Businesses

One of the simplest forms of effective tax planning advice is ensuring you claim every allowable business deduction. Many owners miss out on legitimate expenses such as professional services, software, travel, training and home office costs.

Every expense must be wholly and exclusively for business use, so keep receipts and digital copies to substantiate each claim. A good accountant can review your accounts to identify overlooked deductions that may lower your taxable profit.

2. Consider the Tax Benefits of Charitable Donations

Charitable donations can support causes you care about while also offering tax advantages. Limited companies can deduct qualifying donations to registered UK charities from their profits before calculating Corporation Tax. Individuals may benefit through Gift Aid, which increases the value of donations while reducing their own tax liability.

Making donations before 5 April means the relief applies to the current tax year rather than the next one.

3. Strategies for Reducing Taxable Income

Reducing taxable income isn’t avoidance. It's a matter of making legitimate, strategic choices to both reduce your company's tax bill and improve its financial resilience.

You can:

• Maximise pension contributions within annual limits.

• Advance planned purchases or investments into the current tax year.

• Review director salaries and dividends to maintain efficiency.

• Offset previous losses against current profits where rules allow.

4. Last-Minute Tax Moves to Consider

Even as the year-end approaches, there are quick wins worth exploring.

Pay outstanding invoices promptly to recognise income in the next period. Consider deferring new contracts or delaying invoicing until the new financial year if appropriate.

Review your capital allowances, especially on equipment and vehicles, to ensure you claim the maximum deduction. For example, check if you can use the Annual Investment Allowance (AIA) on qualifying expenditure. Small adjustments now can make a measurable difference once the books close.

5. Keeping Records Organised

Accurate records are the foundation of every successful tax strategy. Disorganised or incomplete data can cause delays, missed deductions or penalties.

Use cloud-based software to track expenses, reconcile bank transactions and generate real-time financial reports. Consistent bookkeeping also makes it easier for your accountant to provide accurate year-end analysis and tailored tax planning advice.

6. Capital Gains and Dividends: Critical Year-End Review

Year-end is also the time to assess your capital gains tax position. If you’ve sold assets, shares or property, review how much gain you’ve realised and what allowances still apply. Strategic use of the annual exemption, currently £3,000 for individuals, can prevent unnecessary tax exposure.

For company directors, check your dividend timing and amounts to stay within efficient tax bands. Adjusting when and how you take income can reduce overall liability while keeping your personal finances balanced.

Plan Early, Save Smart

If you want tailored, professional tax planning advice to minimise your tax headaches, Link Up can help. We connect business owners with trusted accountants who provide expert tax advice and strategic insight.

Book your free financial health check today and make sure your next tax year starts on the strongest footing.

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