From ISAs to tax-free gifts, the deadline looms for exploiting allowances

Sunday 22 March 2009 01:00 GMT
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Less than two weeks remain for Britons to make the most of their tax-free and tax-deductible allowances.

The April deadline marks the last chance to use up the maximum £7,200 allowance for individual savings accounts, and Icesave ISA customers refunded by the Financial Services Compensation Scheme have until 5 April to reinvest that cash with a new provider, or risk missing out on the tax savings.

The same deadline applies to any capital gains allowance for profitable investments in 2008-09, set at £9,600, as well as the annual exemption for inheritance tax. This allows up to £3,000 to be given away as cash or gifts each year without incurring tax, On top of this, small gifts of up to £250 a year can be given to any number of people.

Those who wish to contract back into the state second pension must also make the move before the April cut-off point by completing form CA1543.

"Everybody should be doing their financial house- keeping now," says Anita Monteith at the Institute of Chartered Accountants in England and Wales.

"This is the time to make sure everything is in the right place, from your individual savings account to your pension pots."

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