Planning versus filing — a genuinely different exercise
By the time a return is being filed, most of what determines the tax outcome for that year has already happened — income was earned, expenses were incurred, and any structural decisions were already made. Filing can optimise around the margins, but it can't undo a decision that's already locked in. Planning is what happens before that point: deciding whether a particular expense should be incurred this year or next, whether a business should be run through a company or an LLP, or whether the new or old tax regime fits a specific year's numbers better.
Good planning is also honest about its limits. It works within what the law actually permits, and it holds up if the department ever looks closely at it — an arrangement that only survives because nobody checks isn't a plan, it's a risk being carried silently.
Common areas we work on
- Entity structure — whether a business is better run as a proprietorship, partnership, LLP or company, given its expected profit level, funding plans and compliance appetite.
- Regime selection — for individuals and firms where a choice applies, modelling the actual numbers rather than defaulting to whichever was used last year.
- Timing of income and expenditure — where legitimate discretion exists over when a transaction is booked, planning around it ahead of year end rather than after.
- Capital gains planning — around the timing of asset sales, and the exemptions available for reinvestment under specified sections, planned before the sale rather than after.
- Remuneration structuring — for owner-managers of a company or partners in a firm, balancing salary, remuneration and dividend or profit distribution against their respective tax treatments.
- Advance tax and cash flow planning — aligning tax payments with the business's actual cash position through the year, rather than facing a large, unplanned outflow near a due date.
How a tax planning engagement runs
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Understanding the current position
Current structure, income pattern and existing deductions are reviewed, along with any specific transaction or decision the client is weighing.
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Modelling the options
Where more than one path is available — a regime choice, a structure choice, a timing decision — each is modelled against the client's actual numbers, not a generic example.
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Recommending an approach
A recommendation is made with the reasoning behind it made explicit, so the client understands the trade-off being made, not just the conclusion.
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Implementing ahead of the deadline
Where the plan depends on action before a specific date — a regime election, a transaction timed before year end — that action is taken with enough margin to actually meet the deadline.
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Reviewing periodically
Since income, law and circumstances all change, a plan made for one year is revisited rather than assumed to still be optimal indefinitely.
Practical notes from our engagements
- Planning conversations happening in March, for the year ending that month. Most planning options — timing decisions, structural changes, regime elections — need to be acted on before the event, not after; a conversation in the last weeks of the financial year has already lost most of its options.
- Structure decisions made for last year's tax position, not this year's. A business's profit level and funding needs change, and a structure or regime chosen when the business was smaller doesn't automatically remain optimal as it grows — periodic review matters more than a one-time decision.
- Deductions claimed without the supporting evidence actually being in place. A deduction is only as good as the documentation behind it — planning to use a deduction without the paperwork to support it if questioned is planning that doesn't actually hold up.
How we handle tax planning
We work from the client's actual numbers, model the realistic options rather than a generic textbook comparison, and are explicit about the trade-offs in any recommendation. Planning conversations happen well ahead of the relevant deadline or transaction, since most of the value in tax planning comes from acting before something is locked in, not after.
Related services
Frequently asked questions
What's the difference between tax planning and tax filing?
Filing reports what already happened during the year. Planning shapes decisions — structure, timing, regime choice — before they're locked in, which is why it needs to happen ahead of, not after, the relevant deadline or transaction.
When's the best time to start tax planning for a financial year?
As early in the year as possible — most planning options involve timing or structural decisions that lose their value once the relevant event has already occurred.
Can tax planning help reduce this year's tax if the year has already ended?
Options are much more limited once the year has closed — some choices, like a regime election, can still be made at filing, but most planning value comes from decisions made during the year itself.
Is tax planning the same as trying to avoid paying tax?
No — planning works within what the law permits and holds up under scrutiny. An arrangement that only works because it's never examined isn't planning, it's an unmanaged risk.
Should a growing business revisit its entity structure periodically?
Yes — a structure that suited a smaller business doesn't automatically remain the right one as profit, funding needs and compliance capacity change, so this is worth reviewing rather than assumed permanent.
Does tax planning apply to individuals too, or only businesses?
The same principles apply to individuals — regime choice, timing of capital gains, and structuring investments — though this page focuses on business planning specifically.
How often should a business review its tax planning?
At least annually, and whenever a significant change occurs — a jump in profit, a new investor, a change in business activity — rather than only when preparing to file.