Tax Planning- Year end tax planning

The 2025/26 tax year comes to an end on 5 April 2026. Ahead of this date it is sensible to review your affairs and to make the most of tax saving opportunities.

A good starting point is to consider your allowances for the year as, in most cases, they will be lost if they are not used. If you have not used your personal allowance, you and your spouse/civil partner could consider claiming the marriage allowance which if they are a basic rate taxpayer allows you to transfer £1,260 of your 2024/25 personal allowance to them, reducing your joint tax bill by up to £252.

If you have yet to use your capital gains tax annual exempt amount and are planning on disposing of assets which would trigger a capital gain, consider making the disposal before 6 April 2026 so that the annual exempt amount is not lost. If you are married or in a civil partnership and your partner has yet to use their annual exempt amount is not lost. If you are married or in a civil partnership and your partner has yet to use their annual exempt amount, consider making use of the special rules that allow spouses/civil partners to transfer an asset or a share in an asset between them at a value that gives rise to neither a gain nor a loss. This will allow their annual exempt amount to be used too.

If you have yet to use your ISA allowance, consider investing in a cash and/or stocks and shares ISA before the end of the tax year. With an increase in the dividend tax rates from 6 April 2026 and the savings tax rates from 6 April 2027, it makes sense to shelter as much as possible. Interest and dividends within an ISA are tax free.

Contact us to arrange a year end review.