AS we approach the end of another tax year, there is still time before the April 5 deadline to review our affairs to ensure that we are obtaining the maximum benefits of available allowances and reliefs.

In doing so, it is worth looking not just at husband and wife but also parents and children.

Both husband and wife have the benefit of the Personal Allowance and the basic rate tax band. Transfers of assets between them are free of all taxes.

It may be beneficial to review the assets of each spouse to see if transfers can be made from one to the other to ensure Personal Allowances are not wasted and basic rate tax bands are utilised as far as possible whilst at the same time mitigating the extent of any higher rate tax liabilities on the transferring spouse.

Basic rate taxpayers can save 20% tax on income earned on assets transferred to a spouse who has not used their Personal Allowance.

Those with gross income in excess of £42,475 can save tax at 40% taxpayer and for very high earners, who begin to lose their Personal Allowance when income exceeds £100,000, the saving can be as high as 60% and those over £150,000 could save 50%.

Charitable Gift Aid donations should also be made by the spouse who is the highest rate taxpayer as they are able to obtain the optimum relief for these payments, without affecting the tax position of the charity. Remember to use up each spouses’ ISA allowance, given that the maximum subscription limit has increased to £10,680 (£5,340 for cash ISAs and £5,340 for stocks and share ISAs).

Children under 18 also have their own Personal Allowances and tax bands, but income from capital gifted by a parent is only taxable on a child if it does not exceed £100 gross per annum. Otherwise it is taxable on the parent.

Gifts of up to £3,000 per donor (plus £3,000 for the previous year if unused) can be made completely free of inheritance tax. Larger gifts can be made tax-free and without affecting future tax liabilities provided the donor survives seven years. So if grandparents wish to help with increased educational costs it may well be appropriate for them to gift the money directly to the grandchildren rather than their parents so that any income is assessable on the grandchildren and would therefore be tax free up to the annual Personal Allowance.

Where children work in the family business then payments could be made to them provided the amount is realistic for the work done. A tax deduction will be given to the business for the wages paid and would potentially be tax free in the hands of the child.Potential tax savings may be possible but due consideration should always be given to any commercial or other risks involved with such transactions.