Chartered Financial Planner, Sean McCann, from financial advisers NFU Mutual, shares five top tips ahead of the January 31 deadline for submitting your tax return. 

1. Don’t forget to claim higher rate tax relief on pension contributions 

Sean said: “When you pay into your pension for every £80 you pay in, your pension provider will get another £20 direct from HMRC. If you pay 40% or 45% Income tax you’ll need to claim the extra 20% / 25% via your tax return.

“If you haven’t claimed on previous year’s tax returns, you can go back up to four years and claim any higher rate relief due, by contacting HMRC direct.” 

Recent research suggested that £750m of higher rate tax relief on pension contributions goes unclaimed each year. (1)  
You can claim it here:  gov.uk/government/organisations/hm-revenue-customs/contact/income-tax-enquiries-for-individuals-pensioners-and-employees 

2. Get help with the cost of professional subscriptions 

Sean said: “If you need to be a member of a professional organisation to do your job, and your employer hasn’t paid the subscription for you, you may be able to claim tax relief on the cost. There is a long list of approved professional organisations on HMRC’s website.” 

Available here: https://www.gov.uk/government/publications/professional-bodies-approved-for-tax-relief-list-3 

3. Watch out for the Child benefit tax trap

Sean said: "If you’re the highest earner in your household with an income of more than £50,000, and you or your partner claim child benefit, you’ll need to pay the Child benefit tax charge. For every £100 of income you have over £50,000 you pay 1% of the child benefit. Once your income reaches £60,000 you repay the full amount. 

"You can become subject to the charge if you moved in with someone who is claiming child benefit, even if they’re not your children. The good news is, anything you’ve paid into your pension is knocked off your income before the charge is assessed. If it reduces your income below £50,000 you won’t need to pay the charge."   

"Be warned, you can be fined if you’re income is over £50,000 and you don’t pay the tax due. HMRC has collected £18.9m in fines from people who failed to pay the High Income Child Benefit Tax Charge since its introduction in 2013. 

"More than 500,000 families with children have opted out of receiving Child benefit to avoid having to pay it back. If you think the income of the highest earner in the household is likely to drop below £60,000, it makes sense to restart a claim. If your income is below £50,000 in the current tax year, you won’t be subject to the charge and will keep the full amount of child benefit you are entitled to. Worth up to £2,500 per annum for a family with three children, child benefit won’t be restarted automatically - it needs to be actively claimed. " 

A child benefit claim can be restarted at: https://www.gov.uk/child-benefit-tax-charge/restart-child-benefit 

4. Charitable donations

Sean said: "If you’ve given to charity via gift aid and you pay higher rate tax, you can claim back additional tax relief through your tax return. As an example, if you donate £100 via gift aid, the charity will claim an additional £25, to make the total gift £125. If you pay 40% tax, you can reclaim £25 (£125 x 20%)." 

5. Don’t forget any capital gains

Sean said: "If you sold or gave away property (other than your main home) or shares in the 2019/20 tax year, you need to declare and pay any tax due on gains made. Many people don’t realise that they can face a Capital Gains Tax bill when they gift property or shares to anyone other than their spouse or civil partner. It’s worthwhile checking if you have any losses available to offset any potential bill."