Tax Year End Checklist 2025/26: What to Do Before 5 April

The ISA allowance for 2025/26 is £20,000 as set by HMRC (gov.uk/individual-savings-accounts) per person — the same level it has been since 2017/18. You can split this across cash ISAs, stocks and shares ISAs, innovative finance ISAs and Lifetime ISAs (subject to the £4,000 LISA sub-limit), but the total cannot exceed £20,000.

Any unused ISA allowance on 5 April vanishes. If you've only contributed £5,000 this tax year, the remaining £15,000 is lost forever. For couples, that's a combined £40,000 of tax-free — see GOV.UK for current allowances (gov.uk/income-tax-rates) shelter — savings and investment returns within ISAs are completely free from income tax and capital gains tax, indefinitely.

Practical steps before 5 April:

• Check your ISA contributions for this tax year across all providers. Your provider's online dashboard should show your remaining allowance.
• Top up existing ISAs or open a new one if you haven't used a particular type this year. You can hold one of each ISA type per tax year.
• Consider a stocks and shares ISA for long-term growth if you've already filled a cash ISA. Returns within the wrapper are tax-free regardless of your tax band.
• Lifetime ISA holders under 40: you can contribute up to £4,000 and receive a 25% government bonus (£1,000 free). This counts towards your £20,000 total.
• Junior ISA: if you have children under 18, the JISA allowance is £9,000 per child for 2025/26 — separate from your own ISA allowance.

ISA allowances are use-it-or-lose-it. Even if you can only put away a few hundred pounds, it's worth doing before the deadline. For a detailed breakdown of the costs of not using your allowance, see our ISA deadline guide. For more details, see our guide on pension tax relief.

Pensions are the most tax-efficient savings vehicle in the UK, yet many people leave money on the table. In 2025/26, you can contribute up to £60,000 confirmed by HMRC (gov.uk/tax-on-your-private-pension/annual-allowance) to pensions (the annual allowance) and receive tax relief at your marginal rate — 20% for basic-rate taxpayers, 40% for higher-rate, and 45% for additional-rate.

For higher and additional-rate taxpayers, the savings are substantial. A £10,000 pension contribution effectively costs just £6,000 after 40% tax relief (or £5,500 after 45% relief). Your pension provider automatically claims the basic 20% — but if you pay tax above 20%, you need to claim the extra relief through Self Assessment or by calling HMRC.

Carry forward unused allowance: if you didn't use your full £60,000 allowance in the previous three tax years (2022/23, 2023/24, 2024/25), you can carry forward the unused portion and add it to this year's allowance. This means you could potentially contribute well over £60,000 before 5 April 2026. You must have been a member of a registered pension scheme in each year you're carrying forward from.

Salary sacrifice: if your employer offers salary sacrifice pension arrangements, making a contribution before 5 April saves both income tax and National Insurance. This is more efficient than personal contributions for employees.

Tapered annual allowance: if your adjusted income exceeds £260,000, your annual allowance is reduced by £1 for every £2 above that threshold, down to a minimum of £10,000. If you're near this threshold, careful timing of contributions matters.

Tax-free lump sum: from April 2024, the pension lifetime allowance was abolished, but the tax-free lump sum is capped at £268,275 (25% of the old £1,073,100 LTA). This doesn't affect contributions, but it's worth knowing if you're planning drawdown. For more details, see our guide on capital gains tax allowance.

For a deeper look at this area, read our guide to Making Tax Digital Launches in Weeks.

For more on this topic, see our guide to Self-Assessment Tax Returns.

The Capital Gains Tax (current rates at gov.uk/capital-gains-tax) (CGT) annual exempt amount for 2025/26 is just £3,000 — a dramatic reduction from £12,300 as recently as 2022/23. This allowance cannot be carried forward, so if you have investments outside an ISA or pension with unrealised gains, consider whether it's worth crystallising up to £3,000 of gains before 5 April.

CGT rates for 2025/26 depend on the asset type and your income tax band. For most assets: 18% for basic-rate taxpayers and 24% for higher/additional-rate taxpayers. For residential property that isn't your main home: 18% and 24% respectively (changed from 10%/20% at the October 2024 Budget for non-property assets).

Practical steps:

• Review your portfolio for investments held outside ISAs and pensions with unrealised gains.
• Bed and ISA: sell investments to realise gains within your £3,000 allowance, then immediately repurchase within an ISA wrapper. Future gains are then tax-free. Note: the 30-day 'bed and breakfast' rule means consider buying back in the ISA, not in the same unwrapped account.
• Harvest losses: if you have investments sitting at a loss, selling them before 5 April creates a capital loss you can offset against gains in this or future tax years. Unlike the annual exempt amount, capital losses do carry forward indefinitely.
• Couples: each person has their own £3,000 allowance. Transfers between spouses are CGT-free, so consider transferring assets to a spouse with unused allowance before selling. For more details, see our guide on income tax bands.

The personal allowance for 2025/26 remains at £12,570, with the basic-rate band covering income up to £50,270 (personal allowance plus £37,700 basic-rate band). These thresholds have been frozen since 2021/22 and will remain frozen until at least April 2028 — the effect of fiscal drag means more people are being pulled into higher tax bands each year as wages rise.

Key actions before 5 April:

• £100,000 income trap: if your income is between £100,000 and £125,140, your personal allowance is reduced by £1 for every £2 above £100,000. This creates an effective 60% marginal tax rate. Pension contributions or charitable donations can bring your adjusted net income below £100,000 and restore the full personal allowance — a tax saving of up to £5,028.
• <a href="/posts/marriage-allowance-is-worth-1252-before-april-5-and-most-eligible-couples-never">Marriage Allowance</a>: if one spouse earns below the personal allowance (£12,570) and the other is a basic-rate taxpayer, you can transfer £1,260 of unused allowance — saving up to £252 per year. You can backdate claims for up to four years.
• Charitable giving: Gift Aid donations are particularly valuable for higher-rate taxpayers. A £100 Gift Aid donation costs you just £60 after claiming the higher-rate relief through Self Assessment.
• Check your tax code: an incorrect tax code could mean you've overpaid or underpaid tax all year. Review your latest payslip or log into your HMRC personal tax account to verify.

Beyond the headline ISA and pension allowances, several smaller tax-free allowances reset on 5 April:

Personal Savings Allowance (PSA): basic-rate taxpayers can earn up to £1,000 in savings interest tax-free; higher-rate taxpayers get £500; additional-rate taxpayers get nothing. With savings rates above 4% on many accounts, it's increasingly easy to breach this — especially if your savings are outside an ISA. If you're close to the limit, moving savings into a cash ISA before 5 April shelters future interest from tax.

Dividend Allowance: the tax-free dividend allowance for 2025/26 is £500 (down from £1,000 in 2023/24 and £2,000 in 2022/23). Above this, dividends are taxed at 8.75% (basic rate), 33.75% (higher rate) or 39.35% (additional rate). If you run a limited company and control the timing of dividends, consider whether to take dividends before or after 5 April based on your income position in each tax year.

Trading and property allowances: you can earn up to £1,000 each from trading income and property income without declaring it to HMRC. These are separate allowances.

National Insurance: the employee NI rate for 2025/26 is 8% on earnings between £12,570 and £50,270 (reduced from 10% in January 2024). While you can't directly control NI deductions, salary sacrifice pension contributions avoid NI as well as income tax — making them doubly efficient.

Premium Bonds: NS&I reduced the Premium Bonds prize rate to 3.30% from February 2026. While not a tax year deadline issue, the reduced return makes it worth considering whether your money works harder in a high-interest cash ISA before the allowance resets.

This article is for informational purposes only and does not constitute regulated financial advice. Tax rules, thresholds and allowances are subject to change. For personalised advice on your tax position, consult a qualified tax adviser or financial adviser.