As the tax year end fast approaches, so too does the year-end of many companies. And as this date nears, you can make a few smart financial decisions to help your business finish strong and set yourself up for success in the coming year. 

Here are some key financial decisions you should consider making before the end of your business year. These steps can save you money, reduce your tax burden, and ensure you’re in a strong position to start the new year off right. So, let’s dive in!

Get Ahead of Your Tax Planning

Ah, taxes – they’re not the most exciting topic, but planning now can save you a lot of stress (and possibly money) down the road. Here are a few steps to help you manage your tax situation before the year ends: 

• Review Your Profit and Loss Statement: Now is a good time to check your year-to-date profit and loss statement to see if your business is on track with your expected tax liabilities. 

• Claim All Your Eligible Expenses: If you’ve made any business purchases, don’t forget to ensure you’ve recorded them as deductible expenses. This includes office supplies, travel costs, and even some home office expenses if applicable. 

• Consider Making Contributions to Pensions: Contributing to a pension scheme can reduce your corporation tax liability, and the earlier you do this, the better. A pension contribution for yourself or your employees could be a great way to reduce your tax bill before the year ends. 

You should definitely speak with your accountant to ensure you’re optimising your tax position and making the most of any reliefs available to you (I am not a tax specialist). You may also want to speak to a financial adviser about pension contributions.

Maximise Your Tax-Advantaged Savings Accounts

As a business owner, it’s vital to focus on your long-term financial security. Whether you’re paying into a pension for yourself or your employees, now is a great time to make sure you’re contributing as much as possible before the year’s out. 

If you have a Pension, you may want to consider topping it up before the end of the year to take advantage of the tax relief. This can also help reduce your overall corporation tax bill for the year, making it a win-win for your business and your retirement planning. 

For those who have employees, you might want to ensure that pension contributions are up-to-date or even increase employer contributions. After all, supporting your team’s future is a great way to retain talent!

Review your business insurance

Another essential area to review before year-end is your insurance cover. Your business insurance needs may have changed throughout the year. Did you hire new staff? Take on a new office space? Or acquire any new equipment? If so, it’s time to ensure your insurance policy is up-to-date and properly covering all aspects of your business. 

Consider getting a second opinion on your policy from an insurance expert to ensure you’re not over- or under-insured. If you’re in an industry with changing regulations, now may also be a good time to check whether you need any additional insurance cover. 

You may also want to consider lesser thought about insurance to cover you in instances such as: 

• What happens to shares on the death or critical illness of a shareholder 

• Debt repayment on death of a shareholder 

• What would happen on the loss of a key person 

For more on this, click here.

Review employee and personal benefits

Before the end of your business year, you may want to think about wider financial decisions for the coming year. Think about taking out life cover for your employees and/or, if you are a small company/sole director, for yourself. Cover of this type can often be taken out by the company with premiums both free from Corporation Tax and not treated as a benefit in kind. You can save tax and provide a valuable benefit to your employees at the same time.

Consider giving charitable donations

If you’ve been thinking about giving back, the end of the year is a perfect time to consider making charitable donations or supporting causes important to you. In the UK, businesses can claim tax relief for charitable donations, so this can be a way to lower your tax liability while also contributing to a cause you care about. 

Of course, you’ll want to make sure the charity is registered with the Charity Commission (you can do that here), and keep track of your donations for tax purposes. 

Final Thoughts on Business year-end financial decisions

The end of the year is a great time to take a financial snapshot of your business and make strategic decisions that can positively impact your bottom line, taxes, and long-term success. By tackling these key areas now, you’ll head into the new year feeling more confident and prepared. 

I hope this list helps guide you through the year-end process but remember—you don’t have to do it all alone! If you have any questions about your specific situation or need help making these financial decisions, I’m always here to chat. 

Here’s to a successful year-end and an even more successful year ahead! 

P.S. Feel free to get in touch here if you need any help with retirement planning or reviewing your year-end tax strategy! I’m here to help. 😊 

I am a busy working mum and my office days are Monday and Tuesday. I will endeavour to reply to any emails outside of this time.