Tax Planning Tips for Individuals and Small Business Owners

By Clear Blue Sky Accountancy

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Tax Planning Tips

Updated 17/07/2025

1. Make the Most of Your Personal Allowances

Everyone is entitled to a Personal Allowance (£12,570 in 2024/25), but there are additional allowances too:

  • Dividend Allowance (£500)

  • Marriage Allowance

  • Savings and Starting Rate Band

  • Gift Aid donations (higher-rate relief)

Check you're not missing out—these can significantly reduce your tax liability.

2. Use ISAs to Protect Your Savings & Investments

ISAs are a tax-free way to grow your money:

  • Cash ISAs: No tax on interest.

  • Stocks & Shares ISAs: No capital gains or dividend tax.

  • Lifetime ISAs: 25% bonus from the government.

You can invest up to £20,000 each year—use it or lose it by 5 April.

3. Maximise Pension Contributions

Contributing to a pension is one of the most effective tax planning tools:

  • Up to £60,000 a year (or 100% of your income) is tax-deductible.

  • Can reduce your taxable income and help reclaim child benefits or personal allowance.

  • Great for higher-rate or additional-rate taxpayers.

Salary sacrifice arrangements may offer National Insurance savings too.

4. Claim All Allowable Business Expenses

If you’re self-employed or run a limited company, ensure you're claiming all legitimate expenses:

  • Business mileage

  • Office costs

  • Marketing and software

  • Professional services

Every pound claimed reduces your taxable profit.

5. Time Your Dividends and Income Wisely

If you're a director/shareholder, be strategic with how and when you extract profits. A smart mix of salary and dividends can help you avoid higher tax bands or unnecessary National Insurance.

6. Consider the Right Business Structure

Should you operate as a sole trader or limited company? This decision affects:

  • Tax rates

  • National Insurance contributions

  • Access to allowances

  • Investment and pension strategies

A professional review of your structure can unlock major savings.

7. Capital Gains Tax: Use Your Annual Allowance

Selling shares, property, or assets? You’ve got a £3,000 CGT allowance in 2024/25. Plan disposals across tax years or between spouses to double up on exemptions and reduce liability.

8. Don't Leave It Too Late

Most tax-saving opportunities disappear after the tax year ends (5 April). Planning early gives you more options—especially for pensions, dividend timing, and business investments.

💡 Ready to Optimise Your Tax Position?

At Clear Blue Sky Accountancy, we help individuals and business owners make confident, tax-efficient decisions all year round. Whether you're navigating dividend strategies, pensions, or complex business tax planning—we’ve got you covered.

📞 Call us today on 01752546732 / 07398720140 / 07591261639
📧 Email: hello@clearblueskyaccountancy.co.uk
🌐 Visit: www.clearblueskyaccountancy.co.uk
🎁 Download our Free Tax Planning Guide [coming soon]

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