Unleash Tax-Free Power: Your Guide to Maximising Allowances (2023/24 Edition)

Tax season might feel like a dragon guarding your hard-earned treasure, but hold on to your dragon-slaying sword! You have secret weapons - allowances. These tax-free havens let you keep more of your loot, transforming the dragon into a friendly tax kitty (maybe). Let's explore some powerful allowances for 2023/24 and see how you can make them work for you:

1. Personal Allowance: Your tax-free shield starts strong at £12,570, but beware, it shrinks after £100,000, vanishing by £125,140. This year, the withdrawal pace doubles its cruelty, reducing your allowance faster! Don't let it go to waste:

• Dividend Double Play: Use up your halved £1,000 dividend allowance (£500), then soak up any unused personal allowance with tax-free dividends. Double whammy, but half the size!

• Spouse Swap: Transfer 10% of your allowance to your lower-earning spouse or civil partner, giving them more breathing room. Claim it on gov.uk/apply-marriage-allowance.

• Bonus Blitz: Time a family or personal company bonus before the April 5th deadline to fill your allowance bucket. Every penny counts!

• Income Acceleration: Pull in income from the next tax year (before April 6th, 2024) to top up your current year's allowance. Think strategically!

2. Marriage Allowance: A marriage saver! If one partner earns less, they can transfer 10% of their unused allowance, boosting their tax-free zone by up to £252. Don't forget to claim it!

3. Trading Allowance: Self-employed warriors, rejoice! Earn up to £1,000 tax-free from your hustle without the HMRC paperwork. Claim it directly against your taxable profit.

4. Property Allowance: Rent out a room in your own home for up to £1,000 tax-free with the Rent-a-Room scheme. Double your allowance if you share the income!

5. Savings Allowance: Basic rate taxpayers get £1,000 tax-free savings, like before, but higher-rate savers face a 50% allowance cut, now getting only £500. Additional rate taxpayers? No allowance for you! Time to explore ISAs for extra freedom.

6. Dividend Allowance: Prepare for a big change! The dividend allowance shrinks by half, now at a measly £1,000. Extracting profits from your family company needs strategic planning.

7. Capital Gains Tax Annual Exempt Amount: Breathe easy, this remains unchanged at £12,300. Plan your asset sales wisely to maximise this haven.

So, embrace these allowances, turn tax season into a breeze, and watch your bank account flourish!

Remember, with significant changes to some allowances, staying informed and consulting HMRC or a tax advisor is crucial for accurate tax planning.