Key Takeaways:

• The “Easter Deadline”: The tax year ends on April 5th (Easter Sunday), so aim to complete all electronic transfers by Thursday, April 2nd.
• ISA & JISA: The £20,000 ISA and £9,000 Junior ISA allowances are “use it or lose it”.
• Pensions: You can contribute up to £60,000 this year, with the option to “carry forward” unused allowances from previous years providing the MPAA (Money Purchase Annual Allowance) has not been triggered and no tapering has been applied.
• Capital Gains: The exemption is just £3,000. Careful planning is needed before selling assets.
• High Earners: Earning over £100k? You may face an effective 60% tax rate unless you act now.

Introduction: The Clock is Ticking (and the Banks are Closed)

We are entering the final sprint of the 2025/26 tax year. Usually, we talk about the “April 5th deadline.” However, this year, April 5th is Easter Sunday.

This means Bank Holiday Friday (April 3rd) and Easter Monday (April 6th) will disrupt normal banking hours. If you leave your transfers until the weekend, they may not clear in time to count for the 2025/26 tax year.

Considerations for my clients in Worcestershire: Treat Thursday, April 2nd as your real deadline.

Here is your checklist to ensure you don’t leave “free money” on the table.

1. The ISA Allowances: Use It or Lose It

The most popular tax wrapper in the UK remains the most urgent. You cannot carry over unused ISA allowance to next year.

• Adult ISA: You have a £20,000 allowance.
  • Strategy: You don’t need to invest the money immediately. You just need to get the cash into the ISA wrapper before the deadline. You can decide where to invest it later.
• Junior ISA (JISA): You have a £9,000 allowance per child.
  • Reminder: This money belongs to the child and is locked away until they are 18. It is a powerful way to build a university fund or house deposit tax-free.

The “Bed and ISA” Trick: If you have investments outside an ISA (in a General Investment Account), you can sell them and immediately buy them back inside your ISA. This moves the money into a tax-free environment forever. Be aware that selling your investments may create a taxable gain if the profit exceeds your annual CGT allowance, so it’s important to check your position first.

2. Pensions: The “Carry Forward” Opportunity

For business owners and high earners, pensions remain the most tax-efficient way to extract profits or reduce income tax.

The Annual Allowance for 2025/26 is £60,000. However, unlike ISAs, you can use unused allowances from previous years.

• Carry Forward: You can look back at the last three tax years (2022/23, 2023/24, 2024/25) and utilize any unused allowance, provided you were a member of a pension scheme during those years. , and have sufficient earnings to support the contribution if a personal contribution is being made.
• The “Cliff Edge”: The 2022/23 allowance (£40,000) falls off the cliff on April 5th. If you don’t use it now, it is gone forever.

3. The £100k “Tax Trap” (60% Tax Rate)

If your “adjusted net income” is between £100,000 and £125,140, you are in the danger zone.

For every £2 you earn above £100k, you lose £1 of your tax-free Personal Allowance. This creates an effective tax rate of 60%.

• Example: A bonus of £1,000 in this band effectively puts only £400 in your pocket.

The Fix: Making a personal pension contribution reduces your “adjusted net income.”

• If you earn £110,000 and put £10,000 gross into a pension, your adjusted income drops back to £100,000.
• You restore your full Personal Allowance.
• You get 40% tax relief on the contribution.
• Result: You effectively instantly make 60% tax relief on that contribution.

4. Capital Gains Tax (CGT): The New Reality

Gone are the days of the £12,300 CGT allowance. For 2025/26, your tax-free exemption is just £3,000.

If you are planning to sell a buy-to-let property or a large portfolio of shares:

• Spousal Transfers: You can transfer assets to your spouse/civil partner tax-free before selling. This allows you to use two allowances (£6,000 total) instead of one.
• Bed and Spouse: One spouse sells shares to use their allowance, and the other spouse buys them back immediately (keeping the asset in the family while resetting the gain).

5. The “Sleep Easy” Checks

• Marriage Allowance: If one spouse earns less than £12,570 and the other is a basic rate taxpayer (earning under £50,270), you can transfer £1,260 of allowance to the higher earner. It saves up to £252 in tax.
• IHT Gifting: You can gift up to £3,000 this year IHT-free. If you didn’t use last year’s allowance, you can carry it forward to gift £6,000 now.

FAQs

Q: Can I pay into my ISA on Easter Sunday (April 5th)? A: Technically, yes, if your provider’s online system accepts it. However, bank transfers can be delayed on weekends and Bank Holidays. Consider We strongly advise acting by Thursday, April 2nd to avoid technical stress.

Q: I’m self-employed. Does the £60k pension limit apply to me? A: Yes, but with a catch. In order to claim tax relief Your contributions are limited to 100% of your relevant UK earnings. If you only earned £30,000 profit, you can only personally contribute £30,000 (gross), to obtain tax relief, even if you have £60,000 in the bank. The MPAA must not have been triggered, and no tapering applied.

Q: What happens if I accidentally pay too much into my ISA? A: Don’t panic. HMRC will contact you after the tax year ends, and the excess will be removed and taxed. However, it’s messy and best avoided!