If you have a March year-end or if your year-end straddles 5 April, the end of the tax year, you will need to act quickly to ensure that you maximise your tax savings for this tax year. You will also need to ensure that your books, records and record-keeping is up to date. Here is a list of some key planning points as the end of the tax year approaches.
• New expenditure of up to £100,000 on equipment and machinery for your business will attract a capital allowances of 100%.
• Expenditure on low emissions vehicles can also attract capital allowances of up to 100%.
Make purchases before 5 April 2011 to claim tax relief in this year.
Wages paid to family members
If you have family members on the payroll ensure that you physically make payment to them before 5 April 2011, into their own private bank account if possible. Otherwise, HM Revenue& Customs could try to disallow a tax deduction in your accounts.
Goods for own consumption
If you have taken, or are thinking about taking, goods out of business stock for your own use or consumption you can face an unexpected tax charge. It might be better to ensure that the cost of goods purchased for you are debited to drawings and not included as trading stock and adjusted out for tax.
Motoring and mileage records
Unless you are claiming mileage allowances, you need to ensure that you have kept a journey log for part of the year so that you can estimate what proportion of your expenses relate to business use. It is not too late to start a mileage log for past year, providing that your journeys for the rest of the month are representative of your typical travel pattern.
Books and records
Ensure that you have retained or downloaded copies of internet bank statements for the year. If you have any missing your bank may charge you extra for duplicates.
Pension contributions can reduce higher rate tax and new rules mean that you may have unused annual allowances to bring forward to 2011/12