Year-End Tax Planning Guide for 2025/26
YEAR-END TAX PLANNING FOR 2025/26
With the tax year ending on 5 April 2026, time-sensitive opportunities exist to optimise your tax position before significant changes take effect in 2026/27 and beyond.
KEY UPDATES FROM THE BUDGET (NOVEMBER 2025):
Personal Allowance & Higher-Rate Threshold: Frozen at £12,570 and £50,270 until 2030/31.
Tax Increases: Rates on savings income, dividends, and property income will rise in the future.
Cash ISA Limit: Reduced to £12,000 for those under 65 from April 2027.
Salary Sacrifice Changes: Pension contributions exempt from NICs capped at £2,000/year starting April 2029.
KEY OPPORTUNITIES BEFORE 5 APRIL 2026
For Individuals & Couples:
Maximise use of personal allowances and tax-free bands through income splitting
Utilise £3,000 (potentially £6,000 with carry-forward) IHT gift exemption
Optimise dividend and savings income across household
For Business Owners & Directors:
Bring forward dividends to benefit from lower tax rates (saving up to 2% on all payments)
Review timing of bonuses and income to avoid higher-rate thresholds
Consider company car reviews - electric vehicles offer substantial tax savings
For Investors:
Use £3,000 CGT annual exemption before year-end
Maximise £20,000 ISA allowance (especially cash ISAs before limit reduction)
VCT investments by 5 April qualify for 30% relief vs. 20% thereafter
For Retirement Planning:
Make pension contributions up to £60,000 (plus potential carry- forward)
Tax relief ranges from 20% to 63% depending on circumstances
Review pension withdrawal strategies given upcoming IHT inclusion from April 2027
Click here for the full Autumn Budget 2025 report.