5 Weeks Until Tax Year-End: Your Essential Action Plan

It's 1 March. The 2024/25 tax year ends on 5 April 2025.

That's 5 weeks to get organized, reduce your tax bill, and avoid last-minute panic.

Here's exactly what you need to do - whether you're a sole trader or company director.

Why This Matters

After 5 April 2025, you can't:

- Claim expenses for 2024/25

- Use this year's allowances (they don't carry forward)

- Make pension contributions that count for this year

- Reduce your 2024/25 tax bill

But right now, you still can. Let's make sure you don't leave money on the table.

For Sole Traders: What to Do Now

1. Week 1-2: Get Your Books Straight

Stop everything and update your records:

- Gather bank statements from 6 April 2024 to now

- Find all receipts and invoices

- Update your accounting software or spreadsheet

- Calculate your actual profit

You can't make smart decisions if you don't know where you stand.

2. Check Every Expense

Most sole traders forget to claim:

Home Office:

- £6/week (up to 25 hours) or £18/week (25-50 hours) or £26/week (50+ hours)

- Or calculate actual: portion of rent, utilities, council tax, internet

Mileage:

- 45p per mile (first 10,000 miles), then 25p

- NOT your commute

Equipment & Tech:

- Computer, software, phone (business portion)

- Office furniture, printer, stationery

Professional Costs:

- Accountant, memberships, training, insurance

Marketing:

- Website, domain, advertising, business cards

Go through your bank statements line by line. You'll find hundreds in forgotten expenses.

3. Week 3: Make Pension Contributions

This is huge for tax savings.

Example:

Profit: £40,000

Tax bill: £5,000

Put £5,000 in pension before 5 April:

- Costs you £4,000 (20% tax relief added automatically)

- Taxable income drops to £35,000

- Tax bill drops to £4,000

- You saved £1,000 in tax PLUS built your pension

Annual allowance: £60,000 (or 100% of earnings)

Deadline: 5 April 2025

4. Week 4: Buy Equipment Before Year-End

Planning to buy a laptop, van, or tools? Do it before 5 April.

Annual Investment Allowance: £1,000,000

Full tax relief this year. Buy it on 6 April? It counts for next year's tax return.

5. Week 5: Calculate What You Owe

Quick calculation:

1. Profit minus £12,570 (personal allowance) = Taxable profit

2. Tax: 20% on first £37,700, then 40%

3. Plus National Insurance: Class 2 (£179.40/year) + Class 4 (9% on profits)

Example:

£45,000 profit = approx. £9,584 total tax

Start saving now for your January 2026 payment.

For Company Directors: What to Do Now

1. Week 1-2: Review Salary vs Dividends

Check what you've taken in 2024/25:

- Salary taken so far?

- Dividends declared?

Optimal for 2024/25:

- Salary: £12,570 (or £9,100 if minimizing NI)

- Rest as dividends

Haven't used your full personal allowance? Take more salary or dividends before 5 April.

2. Week 3: Declare Final Dividends

Dividend allowance: £500 (tax-free)

Then: 8.75% (basic), 33.75% (higher), 39.35% (additional)

Important: Declare before 5 April (even if you don't pay out until later).

Must have:

- Board minutes

- Dividend voucher

- Proper accounting entry

Don't just transfer money. Do it properly or HMRC treats it as salary.

3. Make Company Pension Contributions

Your company can pay into your pension:

- Reduces company profits (less Corporation Tax)

- No personal Income Tax

- Counts as business expense

Example:

Company profit: £50,000

Corporation Tax (25%): £12,500

OR: Put £20,000 into pension before 5 April

Company profit: £30,000

Corporation Tax (19%): £5,700

Saved: £6,800 + £20,000 in your pension

Deadline: 5 April 2025

4. Week 4: Strategic Purchases

Company buying equipment?

Full Expensing/Annual Investment Allowance:

- Up to £1,000,000

- 100% deduction

- Immediate tax relief

Buy before 5 April = tax relief this year.

5. Week 5: Check Your Company Year-End

Your personal tax year (ends 5 April) is different from your company's accounting year-end.

Matters for timing salary and dividends. Work with your accountant on this.

Everyone Should Do This

Use Your ISA Allowance

£20,000 for 2024/25

Use it or lose it. Resets 6 April. Tax-free growth forever.

Capital Gains Allowance

£3,000 tax-free for 2024/25

Selling investments or property (not main home)? Consider doing it before 5 April to use this year's allowance.

Saves up to £560 in tax.

Making Tax Digital (MTD) - Check Your Compliance

6. If You're VAT-Registered (Already Mandatory):

Quick check - are you actually MTD compliant?

□ Using approved MTD software (Xero, Sage, QuickBooks)?

□ Records kept digitally in that software?

□ Submitting through the software (not HMRC website)?

If you answered "no" to any, you're not compliant. Sort this before your next VAT return.

7. Preparing for Income Tax MTD (April 2026):

If your income is over £50,000, from April 2026 you'll need:

- MTD-compatible software

- Quarterly digital updates to HMRC

- Digital record-keeping

That's 13 months away. Don't wait for the rush.

What to do now:

1. Check if your income will exceed £50,000

2. If yes, choose your software (Xero or Sage)

3. Start using it from 6 April 2025 (new tax year)

4. Get comfortable before it's mandatory

Read our complete MTD guide here: https://www.iufinance.co.uk/post/making-tax-digital-mtd-update

Common Year-End Mistakes

1. Waiting until January - Too late to do anything about 2024/25

2. No receipts - HMRC can disallow expenses without proof

3. Mixing personal and business - Accounting nightmare

4. Forgetting payments on account - January bill includes 50% advance for next year

5. Not getting help - Tax saved usually pays accountant fee many times over

Your 5-Week Checklist

Week 1 (1-7 March):

□ Update all bookkeeping

□ Calculate estimated profit

□ Check MTD compliance if VAT-registered

Week 2 (8-14 March):

□ Claim all allowable expenses

□ Review business purchases needed

□ Check salary/dividend mix (directors)

Week 3 (15-21 March):

□ Make pension contributions if beneficial

□ Buy equipment before 5 April

□ Declare final dividends (directors)

Week 4 (22-28 March):

□ Use ISA allowance (£20,000)

□ Review capital gains

□ Choose MTD software if preparing for 2026

Week 5 (29 March - 5 April):

□ Final review

□ Calculate expected tax bill

□ Start saving for January payment

□ Organize all records for tax return

What Happens After 5 April?

Deadline for filing: 31 January 2026

Payment deadline: 31 January 2026

Don't wait until January. File early and you'll:

- Know what you owe (time to save)

- Avoid the rush

- Fix any issues in advance

Need Help?

If this feels overwhelming, you're not alone.

At iUfinance, we help with:

✓ Year-end tax planning

✓ Tax calculations and advice

✓ Salary/dividend optimization (directors)

✓ Pension contribution strategies

✓ MTD compliance and setup

✓ Tax return preparation

✓ All year-round support

Our services:

- Self-Assessment: From £100

- Limited company accounts: £345-£495/year

- Monthly packages: From £50/month

- MTD setup and training: Included

Book a free consultation: 07512280115 or WhatsApp

Don't leave money on the table. Let's make sure you pay the minimum tax legally required.

Final Thought

You have 5 weeks. That's plenty of time if you start now.

Do these three things today:

1. Update your bookkeeping (2 hours)

2. Calculate where you stand

3. Book help if you need it

Start now, thank yourself on 6 April.

Ion Nagurnea

iUfinance