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Tax Year End – 5th April 2021

It’s that time of the year again and what a year it’s been.

We’re going to skip the usual reminders of bagging your Individual Savings Account allowances, banking your Capital Gains Tax allowances, utilising your annual Inheritance Tax gifting allowances and maximising the amazing annual income tax reliefs you can get by maximising your pension contributions etc, trusting that you’ve previously paid attention to the valuable messages delivered by your independent financial adviser.

This year we want to focus on the perfect storm of three converging phenomena which if ignored will scupper your tax-efficient plans:

1) COVID-19 & Homeworking

We continue to experience unacceptable service levels from financial providers as they continue struggling to balance most of their workforce working from their kitchen tables with data security and access to systems. Delays remain the norm and tax year-end will not change that reality.

2) Easter

Yes, it comes along every year, but this year, Easter Monday is Monday 4th April. People will return to work (at the kitchen table) on the morning of Tuesday 5th April – tax year-end day, having powered off their laptops the previous Thursday (1st April) evening for the Easter break. Realistically, tax year-end critical applications will need to have been processed, the money requested, received and cleared before Thursday 1st April.

3) The Advice Process

The advice process is there for mutual protection, remember this is our busiest time of year and for your sake, we need the time to do our research properly for you, to request and receive documents from the financial providers (see point 1 above) and to get our final, considered recommendations to you with sufficient time for you to consider and challenge those recommendations before making a reasoned decision.

So what?

To have a fighting chance to take advantage of advised tax year end advice, processes need to be started today (Monday 15th March) or tomorrow at the latest. 

Many financial product/investment providers are wisely bringing forward their tax-year end application cut-off dates forward, allowing for the “perfect storm” by reducing capacity. Digitally enabled providers to have more ‘wriggle room’ but still need time to request and receive funds.

Monday 22nd March

Having reviewed the bulletins from the major product and investment providers, it is evident that applications about which there are any queries or for which cleared funds have not been received by Thursday 1st April are not going to be processed this tax year. 

In order that we may conduct our checks and get applications to providers with sufficient time for them to process the applications and receive the funds, we need to have fully completed the formal advice process, have application forms, acceptable proof of identity and acceptable proof of source of funds in our possession before the close of business on Monday 22nd March.

Fingers crossed

Last 5th April and this 5th April are not dates on which we’ll look back fondly, but we hope that by 5th April 2022, when Good Friday will be ten days away and workers will be vaccinated against COVID and working more efficiently, that everything will be back closer to what we remember “normal” to be.

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Notices:

Our posts are intended as financial education and financial information, not as financial advice, and are only suitable for UK residents. Always take professional, independent advice before acting on any information.

Investment & Retirement Solutions Ltd is authorised & regulated by the Financial Conduct Authority.

The value of investments and income from them can fluctuate (this may partially be the result of exchange rate fluctuations) and investors may get back less than the amount invested. Past performance is not a guide to future performance.

Your home is at risk if you do not keep up repayments on a mortgage or other loan secured on it.

The Financial Conduct Authority does not regulate taxation and trust advice, will writing, advice on deposit accounts, some types of offshore investment, some aspects of buy to let mortgages, commercial finance or offshore mortgages.

Levels, bases of and reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor. Unless specifically stated otherwise, our posts do not allow for the additional taxation powers which may be levied by the devolved governments.

All information is offered in good faith and is believed to be correct at the time of publication however it may be superseded following publication. E. & O. E.

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