End of tax year checklist for wealthy investors, it starts early

There’s less than three weeks left until the end of the tax year, when most of the investment allowances for the 2023/24 tax year are lost.

Deadlines on some products, particularly venture capital schemes such as EIS, SEIS and VCTs, are sooner still.

Nicholas Hyett, Investment Manager at Wealth Club said, “If you’re a high net worth or sophisticated investor, then the tax year end starts early.

“Despite some tweaks at the budget, tax rates remain at the highest levels in decades – especially for wealthier investors.

“Venture capital schemes that offer generous tax relief for supporting young UK businesses help to alleviate some of that pressure. But, unlike your annual ISA subscription, you can’t afford to leave it until the last minute.

“Especially as this year the Good Friday and Easter Monday bank holidays are so close to the tax year end.

“Many tax efficient investment funds close before the end of March, and popular VCT offers may close even before that.”

Needs to be actioned now

Investors in Enterprise Investment Scheme (EIS) Funds will find that many schemes have already closed for the 2023/24 tax year, but there are a few remaining open with the latest deadline on 28th March, including;

• the Fuel Ventures Follow-on EIS Fund and Haatch EIS Fund, which end on 28^th March 2024.

Investments into EIS qualifying single companies may be possible at a later date.

A week before the end of tax year

For investors in Knowledge Intensive EIS Funds deadlines range from 28^th March up to 5^th April at noon;

• Parkwalk Knowledge Intensive EIS Fund III has a deadline of 28^th March
• Par Knowledge Intensive EIS Fund II 4^th April at 5pm
• Octopus Ventures Knowledge Intensive Fund closes on 5^th April at noon
• Calculus Knowledge Intensive EIS Fund II closes on 5^th April at 5pm.

From three weeks before end of tax year

There are a steady stream of VCT deadlines leading up to the tax year end. Some are deadlines to qualify for discounts or dividend payments, while other VCTs don’t have any deadlines prior to the offer closing for the year. The most imminent deadline for each VCT is shown below

• 20^th March for Albion VCTs
• 22^nd March for Blackfinch Spring VCT, Octopus Apollo VCT and Octopus Titan VCT, Hargreave Hale AIM VCT and Calculus VCT
• 25^th March at 9am for Baronsmead VCTs
• 2^nd April at 5pm for Octopus Future Generations VCT
• 3^rd April for Foresight Technology VCT and Praetura Growth VCT
• 4^th April at noon deadline for Seneca Growth Capital VCT
• 4^th April at 3pm for Guiness VCT and ProVen VCTs
• 4^th April at 5.30pm for Fuel Ventures VCT
• 5^th April at 9am for Maven VCTs
• 5^th April 10am for Molten Ventures VCT
• 5^th April at 11am for Puma Alpha VCT and Puma VCT 13
• 5^th April at noon for Triple Point Venture VCT.

In the last week

• You can shelter up to £20,000 in an ISA or £9,000 in a Junior ISA this tax year and all dividends, interest or capital gains are tax-free. Payments into ISAs at Wealth Club need to be completed and cleared by 5pm on 3rd April, but check the end of year cut off deadlines with your ISA as they vary across providers.
• The annual allowance for adding money in to your SIPPs is £60,000, although you can’t add more than you earned. Wealth Club is accepting cleared payments up to 5pm on 3^rd April but some providers will take payments by debit cards into pensions up to 30 minutes before midnight on 5^th April, but remember that bank transfers can take longer and have earlier cut off deadlines so check with your provider.

24 hours to go

• The Capital Gains Tax allowance will drop from £6,000 to £3,000 from 6^th April. Investors with large gains might consider selling some shares to make use of the higher allowance while they have it.