How Can an Accountant Help Me Plan for Next Year’s Tax

Most people think of accountants as the people who file forms, calculate tax bills, and keep HMRC satisfied. Those things matter but they represent only a small part of what a good accountant does. The real value emerges before the tax return is even due. When an accountant works with you throughout the year rather than only at the deadline they can help you shape next year’s tax position long before HMRC even enters the picture. They spot patterns early, highlight opportunities, identify risks, and help you take steps that reduce the tax you pay rather than simply recording it afterwards.

Planning for next year’s tax is about far more than saving money. It is about control, clarity, and confidence. Businesses and individuals who understand their future tax outlook make better financial decisions, manage cash flow more effectively, and avoid unpleasant surprises. In my opinion the difference between someone who works reactively and someone who plans proactively is often thousands of pounds in tax saved and an enormous reduction in stress.

This guide explains how an accountant can help you plan for next year’s tax, the areas where early planning has the biggest impact, and why working closely with an accountant throughout the year is one of the smartest moves any business owner or individual can make.

Understanding Your Current Position Before Planning Ahead

Every meaningful plan starts with understanding your current tax position. An accountant begins by reviewing how you earned money in the past year, where your profits came from, what your spending patterns look like, how your business is structured, and how your personal finances interact with your business decisions. They look at salary, dividends, trading profits, rental income, investment gains, pension contributions, allowances used and allowances wasted.

With this information the accountant can map out your likely tax position for the current year and forecast how it might change in the next year based on growth, income changes, proposed investments, or personal plans such as moving house, restructuring a business, or growing a team. Planning is impossible without clarity and accountants provide that clarity before anything else.

Helping You Choose the Most Tax Efficient Business Structure

One of the most impactful ways an accountant helps with next year’s tax is by ensuring you are using the right business structure. Many people operate as sole traders when a limited company would be more tax efficient. Others incorporate too early or for the wrong reasons. Some landlords hold property personally when an SPV would be more suitable while others overcomplicate things by using companies unnecessarily.

An accountant can model the tax impact of each option. They explain how salary, dividends, corporation tax, VAT, NICs, and personal tax interact. They help you understand exactly how much tax you would pay under each structure and how those numbers would change if your profits increase. Planning your business structure ahead of time rather than reacting after the year has finished is one of the best ways to reduce your long term tax burden.

Identifying Opportunities for Allowances and Reliefs Before They Expire

The UK tax system provides numerous allowances and reliefs but many of them operate on a use it or lose it basis. Once the tax year closes you cannot go back and claim unused allowances. Your accountant helps you identify which ones matter for you and ensures you use them before they disappear.

This might involve using your capital gains tax allowance before selling an asset next year. It might involve making pension contributions before the deadline to reduce your adjusted net income. It might involve maximising the personal savings allowance, the trading allowance, the dividend allowance, the marriage allowance, the annual investment allowance for your business, or reliefs for research and development.

The point is that none of these opportunities are available retrospectively. You must act while the tax year is still open. An accountant keeps track of these deadlines and ensures your planning is timed correctly.

Supporting Your Cash Flow for Next Year’s Tax Bills

One of the most stressful parts of the tax cycle is not the tax itself but the cash flow. People panic when they see a large bill because they have not prepared. When you work with an accountant throughout the year they can forecast your next tax bill months in advance and help you manage cash flow accordingly.

This includes planning for payments on account if you are self employed, planning for VAT liabilities, preparing for corporation tax nine months after your year end, and anticipating personal tax liabilities from dividends, property, or investment income. When you know what is coming you can set aside the right amount of money each month rather than scrambling at the end.

In my opinion this alone makes the accountant’s role invaluable because it turns tax from a stressful shock into a predictable number you already expected.

Ensuring You Pay Yourself in the Most Tax Efficient Way

How you take money out of your business can have more tax impact than how much profit you make. An accountant helps you plan your salary and dividends for the year ahead, reviews thresholds for National Insurance, considers whether additional pension contributions are worthwhile, and checks whether benefits in kind or company expenses provide better tax efficiency.

For individuals with multiple income streams such as salary, rental income, dividends, and investment income, the accountant can structure your withdrawals in a way that minimises your exposure to higher rate tax. They also help you avoid crossing thresholds that trigger the loss of the personal allowance or the High Income Child Benefit Charge. Without planning it is easy to drift into these traps without realising.

Planning Capital Expenditure and Investment Timing

When you run a business, the timing of major purchases affects your tax bill. Capital allowances, temporary full expensing, and the annual investment allowance all influence how much tax relief you get and when you get it. An accountant helps you plan these purchases strategically.

For example if your business year end is approaching the accountant may recommend buying certain equipment before the year closes to bring relief forward by a full year. On the other hand if your profits are unusually low this year and expected to rise next year your accountant may advise delaying major purchases so that the relief reduces a larger tax bill.

This kind of planning improves both cash flow and tax efficiency.

Helping You Avoid Tax Traps Before You Step Into Them

Tax traps are thresholds or rules that cause sudden jumps in tax liability. Some of the most common include:

• Losing your personal allowance once income exceeds £100,000

• Hitting the High Income Child Benefit Charge at £50,000

• Triggering the tapered pension annual allowance

• Moving into higher rate or additional rate tax bands

• Crossing VAT thresholds

• Creating unexpected benefit in kind charges

• Paying too much dividend tax due to poor timing

Although I am keeping lists to a minimum this group is important because these traps can cost thousands of pounds if not spotted early. An accountant helps you identify these triggers well before you hit them. They can suggest pension contributions, gift aid, or alternative structuring to bring your income back below the threshold. They can help you plan the timing of dividends so you do not fall into a higher tax band unnecessarily. They can warn you when your VAT turnover is approaching the limit so you can prepare for registration properly.

Early planning turns these tax traps into manageable milestones instead of expensive accidents.

Reviewing Your Bookkeeping and Record Keeping to Improve Next Year

Good tax planning depends on good data. If your records are messy your accountant cannot give clear advice. One overlooked way accountants help with next year’s tax is by reviewing your bookkeeping processes and suggesting improvements. This may mean switching to cloud software, separating business and personal spending more clearly, using bank feeds properly, or improving expense documentation.

Better bookkeeping makes it far easier to spot deductible expenses, claim everything you are entitled to, and plan ahead. Many people only improve their bookkeeping after facing a stressful year end. When you involve an accountant early you can make these improvements months before the next accounts cycle begins.

Helping You Understand Tax Changes Coming Next Year

Tax rules change constantly. New allowances appear. Old reliefs disappear. Thresholds freeze. Regulations tighten. The Spring Budget and Autumn Statement often bring updates that apply from the following April. An accountant translates these changes into practical advice.

For example if dividend allowances are being cut your accountant might suggest altering how you take income. If VAT thresholds are increasing you may have more breathing room before registration. If capital gains tax rules change your accountant may advise selling or retaining assets depending on the direction of the reform.

A business owner or individual rarely has the time to monitor tax legislation. An accountant does this for you.

Supporting Major Life or Business Decisions Before You Make Them

Tax planning is not only about income levels and expenses. It also involves the big decisions that shape your year such as buying property, selling assets, expanding a business, hiring staff, incorporating or dissolving a company, restructuring partnerships, taking on investors, changing your compensation model, or retiring.

Each of these decisions has tax consequences that may affect both the current year and next year’s tax bill. An accountant helps you understand these consequences before you act rather than afterwards when options are limited.

For example buying a rental property personally or through a company will create very different tax outcomes. Selling shares in one tax year or the next may change your capital gains position dramatically. Giving money to family as a gift may create inheritance tax consequences if done incorrectly. Planning ahead makes these outcomes predictable and manageable.

Providing Ongoing Guidance Rather Than One-Off Answers

The most effective tax planning happens through ongoing dialogue. When you have an accountant you can reach out to during the year you get small nudges and early suggestions that make a big difference. Perhaps they notice that your income is creeping towards a higher tax threshold. Perhaps they see you are missing opportunities for expense claims. Perhaps they see that your business is overspending in areas that reduce profitability. Perhaps they identify that you could optimise your pension contributions.

Tax planning rarely depends on one big decision. It depends on many small decisions made consistently throughout the year. An accountant provides the clarity needed for this gradual, continuous planning.

Helping You Plan for Long Term Tax Outside the Current Year

Next year’s tax planning is not only about the upcoming tax return. It can also involve long term planning such as pension strategy, inheritance planning, property ownership structuring, business succession, investment planning, and efficient withdrawal of income during retirement. These areas take years to develop yet they influence your tax position every year.

An accountant can help you understand how your decisions today will affect your future self. They can help you build a plan that not only reduces next year’s tax but also aligns with your long term financial goals.

Turning Tax Planning Into a Strategic Advantage

A well planned tax position does more than reduce your bill. It can support growth, improve profitability, enhance cash flow, and reduce financial stress. Businesses with strong tax planning invest with greater confidence, budget more accurately, and grow more sustainably. Individuals with strong tax planning can make decisions about property, investments, or retirement with clarity rather than uncertainty.

In my opinion tax planning should never be reactive. It should be one of the core strategic activities of your year. When you treat it as a year round partnership between you and your accountant the benefits compound. You save tax, make smarter decisions, avoid mistakes, and feel far more in control of your finances.

Final Thoughts

An accountant helps you plan next year’s tax by understanding your current position, forecasting your future position, identifying opportunities before they expire, helping you avoid tax traps, improving your bookkeeping, advising on structure, supporting major decisions, and giving you clarity long before HMRC deadlines arrive. The greatest tax savings rarely happen during the tax return. They happen months before when there is still time to act.

In my opinion the best way to reduce next year’s tax bill is to talk to your accountant early, review your income and spending regularly, and treat tax planning as an ongoing process rather than a single appointment. When you take this proactive approach tax stops being a surprise and becomes something you manage confidently and deliberately.