Friday, 22 March 2019 08:00

Dan Atkinson: Tax planning is all year round

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Dan Atkinson head of technical at EQ Investors Dan Atkinson head of technical at EQ Investors

It seems natural to write about the tax year end and ‘ISA season’ at this time of year.

Certainly, scarcity and time pressures can be a great motivator for some people. The high-pressure environment can even be pleasurable for some as they work to make sure that every contribution is applied on time. Should this be the norm? Is this even the right question?


I think “it depends” is the fairest answer. There will always be some people who won’t know their tax position until the last minute. Traditionally this would have been self-employed individuals or members of partnerships. However, with the Tapered Annual Allowance there will be a wider range of people that won’t really know where they stand until near the end of the tax year. So, for these people some of their planning – particularly around pensions – will still need to occur in this ‘season’.
However, for most other clients there is no real ‘need’ to leave things until the last minute. Indeed, there is a stronger argument for arranging ISA contributions in the ‘first minute’ (of the tax year) and thus benefiting from the shelter from Income/Capital Gains Taxes for longer. Prudent tax planning can, and should, be undertaken throughout the year as part of a regular review cycle. If a client’s financial situation is stable, then then a planned approach dictated by the financial plan would seem to be prudent.
Financial Planning is not just about the numbers and the theory. It’s about people and behaviour. It’s all very well designing a plan and setting the direction, but if no action is taken it’s a vain exercise. We need to be able to help clients take action and understand how best to do this. Some might find a time targeted approach helps them take action because they have something to focus on.
So perhaps instead of thinking about whether we should ‘do’ ISA season, we should ask ourselves the following questions. What best helps your clients to take action? How can you best support them to do this – and ultimately progress their financial plan? Are your systems and processes up to the job of delivering this consistently? What would your clients say if you managed to pull this off? How would this affect your business?

Dan Atkinson FPFS MCSI APP is a Chartered Financial Planner and is head of technical at EQ Investors in London. @DanAtkinsonUK. e: This email address is being protected from spambots. You need JavaScript enabled to view it.


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Read 781 times Last modified on Thursday, 21 March 2019 15:56
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