News
Tax Year-End Planning: Why January Is the Right Time to Review
15 Jan 2026
5th April 2026 might feel like it’s ages away, but when it comes to effective tax planning, we’re already running short on time. Every year at WR Partners, we have conversations with business owners who suddenly realize in March that they’ve got a bigger tax bill coming than they’d planned for. By that point, the options for doing something about it are pretty limited.
Why Timing Matters
The key thing to understand is that most legitimate tax planning strategies need to be in place before the tax year ends on 5th April. You can’t claim reliefs or make strategic decisions retrospectively. Once the year closes, your tax position is largely fixed.
Start in January, and you’ve got a full quarter to make considered decisions rather than rushed ones. Leave it until March, and you’re scrambling to get paperwork processed before the deadline.
What You Should Be Thinking About
The specific opportunities depend on your situation, but here are the most common areas we discuss with clients at this time of year:
Pension contributions are often one of the most tax-efficient ways to reduce your bill whilst building long-term wealth. For most individuals, this tax year’s annual allowance is £60k and unutilised allowances from three prior tax years can be brought forward to maximise contributions whether personal or through your company.
Capital expenditure timing can make a significant difference if you’ve been planning to invest in equipment, vehicles, or technology. Various capital allowances might be available, but you need to get the timing right to claim relief against this year’s profits.
For owner-directors, reviewing your mix of salary and dividends is important each year. Tax rates and allowances change, and what worked last year might not be the most efficient approach this year.
If your business has made a loss, there are various ways you might be able to use that loss to reduce tax in other years. The rules can be complex, and making the right claim requires forward planning.
Finally, you’d be surprised how often businesses miss out on reliefs and allowances simply because they weren’t aware they qualified. From R&D tax credits to employment allowances, it’s worth making sure you’re claiming everything you’re entitled to.
It’s Not Just About Reducing Your Bill
Here’s something that often gets overlooked: good tax planning isn’t only about paying less tax this year. Sometimes the smartest move is to pay a bit more tax now because it sets you up better for the future.
You might decide to extract profits this year even if it means a higher tax bill, because you’re expecting rates to increase next year or because you need the funds for a specific purpose. Or you might choose to invest in pension contributions now because they’ll provide tax-free growth over time.
The point is, effective planning means looking at your whole financial picture and making decisions that work for where your business is heading, not just where it is today.
Getting Started
If you haven’t looked at your tax position for the year ending 5 April 2026 yet, now really is the time. Not in a panic, just a proper review to see where you stand and what your options are.
Working with businesses across Shropshire, Cheshire, and Wales, we’re noticing more business owners are being cautious about cash flow and thinking carefully about the balance between tax efficiency and maintaining working capital. Others are using this as an opportunity to review their business structure entirely.
The conversation doesn’t need to take hours, and it could save you considerable amounts in unnecessary tax or help you make better strategic decisions for your business.
Get in touch with your usual contact at WR Partners, or give us a call on 08000 664 664 or email hello@wrpartners.co.uk. We’re here to help you make the most of the time we’ve got left before the year end.
