Taxability Checklist

  • Taxability Checklist

    Please take a few minutes to tell us more about you and your preferences

  • The checklist asks a short series of questions to help you spot opportunities you might be missing.

    TaxAbility has been researched and written by Chartered Accountants and Chartered Tax Advisers. We keep it up to date with the latest rules, but please get professional advice before acting on your answers.

    Most questions are about tax, though a few touch on wider personal and financial planning.

    As you go, ask yourself:

    Have you spoken to your accountant about this?

  • What type of business are you?
    • Your Business 
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    • Do you have employees?*
    • Are you sure that you are taking money out of your business in the most tax-efficient way?
    • Are you paying your spouse a tax-efficient salary?
    • Have you made the most of your opportunities to save tax by investing in a personal pension?
    • Have you reviewed your pension arrangements recently?
    • Have you considered whether there are any benefits from converting partnership/business loans and/or surpluses into personal loans - or vice versa?
    • If you are a sole trader or partnership, have you considered making key employees partners?
    • Have you made the most of your opportunities to save tax by investing in a personal pension?
    • If you have subscribed for shares in an unquoted company and lost money, have youmade a claim for tax relief?
    • Have you considered the legitimate ways to increase or decrease your business profits so that your allowances and tax rates are used as efficiently as possible?
    • If you are about to invest in a new car, computer or any other business equipment, have you considered the best time to buy them and the best way to pay for them?
    • If your business has made losses, have you made sure that those losses are being used to reduce your current tax bills by as much as possible?
    • If you run a very profitable limited company, have you done everything possible to make sure that your profits taxed are as low as possible?
    • If you run a company or a partnership and sell your personal services, knowledge or skills, have you taken appropriate steps to ensure that the IR35 rules won’t cost your business a fortune in additional tax?
    • If you run a one-person band business (not a limited company), have you made sure that there is absolutely no possibility of the Taxman charging you much more money by treating you as being employed by one or more of your best customers?
    • Have you considered recently (i.e. in the last 12 months) whether your business would be better off trading as a sole trader, partnership, limited company or limited liability partnership?
    • If you trade through a limited company and pay your spouse or minor children dividends on shares they own, are you sure that the Taxman won’t be able to tax those dividends as if they were your income?
    • Have you correctly recorded dividend payments by your company on board minutes and dividend vouchers?
    • Have you considered using different classes of shares for company shareholders?
    • Have you planned ahead and taken action to minimise your tax bills when you eventually come to sell the business?
    • If your company invests in Research and Development (‘R&D’), have you planned how to make the most of the up to 186% effective tax relief?
    • Have you considered making greater use of business gifts as a marketing tool?
    • If you are not already registered for VAT, do you have a system for making sure that you are still entitled to stay non VAT registered?
    • If your sales are less than £1.35m a year, are you making VAT potentially much easier and cheaper for your business by making the most of the cash accounting scheme or the annual accounting scheme?
    • If your sales (excluding VAT) are less than £150,000, have you considered switching to the flat rate VAT accounting scheme?
    • Do you always time the payment of dividends and bonuses from your company so that they fall in the “right” tax year for you?
    • Have you considered reducing the amounts of cash held by the company?
    • If your company owns property that it rents out, have you fully considered the tax opportunities?
    • If you own any business property, have you maximised the capital allowances that you can claim?
    • Have you considered the impact of Business Asset Disposal Relief and Capital Gains Tax rules on selling your business and/or assets?
    • Employees 
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    • Employees

    • Do you have a company pension scheme?  Are you making the most of pensions as a highly tax efficient way of rewarding and retaining key team?
    • Have you explored how to use pensions to cut the tax bill on wages and salaries?
    • Have you considered using one of the more “exotic” types of pension schemes to give you more control and flexibility and allow you and your team to build up even bigger nest-eggs?
    • Have you told the Taxman about any changes to your company cars or who uses them?
    • If you provide company cars, have you checked in the last year whether you and your employees could be better off by changing your company car and petrol policy?
    • If your employees use their own cars for company business, do you know how the mileage rules affect them and the business?
    • Have you considered providing your employees with low emission cars?
    • Are you utilising the rules for employees taking home company vans?
    • Are you certain that you make the most of tax-free benefits in kind for your team?
    • If you use contract workers and freelancers, have you made absolutely sure that the Taxman has no grounds for treating them as your employees?
    • If any of your employees have been with you for more than 20 years, do you know how to reward them with a really special long-service present that is completely tax free for both you and them?
    • If your employees work from home, are you using the rules so that you can reimburse them tax free?
    • Have you looked into whether it is possible to cut your costs and improve your cash flow by paying your PAYE and National Insurance quarterly instead of monthly?
    • Have you looked into whether you can reduce the amount of National Insurance you pay by reclaiming your Employment Allowance?
    • Have you looked at the possibility of motivating and rewarding your team by giving them share options?
    • If you have lower-paid employees, employees with children, or employees struggling with household costs, have you signposted them towards checking whether they may be eligible for Universal Credit, Pension Credit, or other support?
    • Are you sure that you are staying on the right side of the minimum wage law?
    • Have you advised your employees to check their 2026 / 2027 PAYE coding to make sure that the details are correct and that they are receiving the correct allowances? And have you done this for your own notice of coding? Especially with HMRC now including estimated savings income within the code.
    • You And Your Family 
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    • You And Your Family

    • Have you made a will? Have you updated it recently? And is it Inheritance Tax efficient?
    • What happens to your family and business if you are ill or die? Do you have life assurance, permanent health insurance and critical illness cover? Have you reviewed your policies recently? Are they still the best policies for you?
    • If you give money to charity, have you made sure that the Taxman makes your donation even bigger by using, for example, Gift Aid and payroll giving?
    • If you are planning on moving home, have you explored the possibility of taking a business loan instead of a mortgage?
    • Have you considered changing your mortgage?
    • As there is no tax relief on mortgages, have you considered reducing your mortgage, or using a flexible or offset mortgage?
    • Have you made full use of the fact that each of your children can earn up to £12,570 in 2026/27 as income and £3,000 a year in capital gains - completely tax-free?
    • Have you maximised the government contributions into pensions for your children?
    • If your estate is large, have you considered Inheritance tax planning? Taking out an insurance policy that will pay your inheritance tax bills when you die? Using lifetime gifts to avoid paying inheritance tax altogether?
    • If you are intending to pay for private education for your children, have you taken steps to either put enough money aside to fund it, and/or explored the possible tax breaks to make the money go further?
    • Have you used legitimate ways to reduce your tax bills by transferring income from a spouse paying tax at higher rates to a spouse paying tax at lower rates?
    • Your Investments 
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    • Your Investments

    • Have you reviewed your investments to ensure that they are appropriate and per forming well? Are they giving you the right balance of income and capital growth?
    • Have you considered investments that give you a tax-free return? For example National Savings Certificates, Friendly Societies and ISAs
    • If your spouse pays tax at a lower rate than you, have you considered passing some of your investments to them in order to reduce your combined tax bills?
    • If some of your investments have done very well and grown in value have you considered whether it is sensible to sell some of them to save yourself even higher tax bills in the future?
    • If you own any buy-to-let properties, have you considered owning them jointly with your spouse/civil partner?
    • Have you considered the three main ways of getting tax relief on the full cost of your investments and not just on the interest you earn on those investments?
    • If you are considering investing in property (other than your home), have you considered taking out a loan to finance the purchase?
    • If you are considering investing in a second residential property perhaps for your children to use while at University, have you thought about the new higher rates of Stamp Duty/Land and Buildings Transaction Tax/Land Transaction Tax on second properties?
    • If you have one or more personally owned residential rental properties with mortgages or other finance costs, have you reviewed the impact of the finance cost restriction and considered your options?
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