Having battled our way to the office through snow and ice
it may be difficult to imagine that Spring is just around
the corner, and with it the end of tax year. However it is
important that take some time to ensure that we have maximised
our allowances for the year, and this provides us with an
opportunity to review existing holdings to ensure that they
remain appropriate for current market conditions.
Over the next couple of months the financial institutions
will be reminding us to utilise our ISA allowances but will
the funds they promote be appropriate for your personal circumstances,
and compatible with your existing investments, or will they
simply be the ‘flavour of the month’.
Equally you may be planning to add an annual contribution
to your pension scheme but fund performance is vital if you
are to maximise the benefit you are to receive at retirement. If
your existing plan was set up some years ago, and you are
simply contributing to the Managed Fund offering by one life
company, it may well be worth making your new contributions
into one of the newer style of Personal Pensions that are
likely to have lower administration cost as well as offering
a much wider range of funds – many of which will be
from highly respected independent management companies.
If you have not yet utilised your Capital Gains Tax allowance
for the year, or have some losses you could use to offset
other gains, this could be a good time to review your portfolio. It
could also provide a good opportunity to rebalance your portfolio
to benefit from future investment opportunities.
For the more adventurous you could give some thoughts to
placing an investment in a Venture Capital Trust (VCT) as
you could obtain tax relief of 30% on your investment, be
free of Income Tax and Capital Gains Tax on your returns,
and reduce your potential liability to Inheritance Tax once
he investment has been held for at least 2 years. The
catch is that the investments will be in small new companies
so they should be regarded as involving a higher than average
degree of risk.
For help in considering any of these issues please contact
Lisa Murfet at Lisa@mdcnet.co.uk or
Trevor Simms at trevor.simms@birchwoodinvestment.com.
