Tax Year Beginning is the new Tax Year End

Simply filling your allowances at the start of the Tax Year rather than the end could be worth hundreds of pounds to those with ISAs, allowing for 12 months of interest in cash ISAs, or stock growth and dividends in a stocks and shares ISA.

The financial planning world tends to fixate on the end of the Tax Year to make sure none of our clients lose their allowances, but of equal importance is making sure we’re maximising growth opportunities for clients.

Of course, it’s not for everyone and for many people in the UK, filling £20,000 of ISA allowance and £60,000 of pension allowance feels far off, but for others, it’s a chance to make sure tax liabilities are reduced and once it’s done, you don’t need to worry about it for another 12 months.

Here are some of the allowances for 2025/26 to be aware of:

• £20,000 individual savings allowance
• £9,000 junior ISA
• £60,000 annual pensions allowance
• £10,000 money purchase annual allowance (for those who have already drawn on their pension)
• £3,000 Capital Gains Tax allowance
• £500 dividend allowance

A note on the annual allowance

The availability of the pensions annual allowance will be impacted by any regular employer or employee contributions being made throughout the tax year. Carry forward will mean more allowance is available but employee/personal tax-relievable contributions are still capped at 100% earnings in the tax year. Self-employed people may not know their relevant UK earnings figure until later in the tax year (or even after the tax year end). These issues can make it less straightforward to maximise pension funding earlier in the tax year.

This article is for information only and does not constitute advice.

Tax rates and allowances are subject to change.

The value of your investments can go down as well as up, so you could get back less than you invested. The Financial Conduct Authority does not regulate tax planning.