Year-End Tax Planning Checklist for 2025-26

Posted: 11 March 2026

As the end of the tax year approaches, it is a good time for individuals and business owners to review their financial affairs and ensure they are making full use of available tax reliefs and allowances. With tax thresholds remaining frozen and several changes on the horizon, proactive planning can help minimise tax liabilities and avoid missed opportunities.

Below is a practical year-end tax planning checklist for 2025-26 to consider before 5 April.

1. Use Your Capital Gains Tax Allowance

Each individual has an annual capital gains tax (CGT) exemption of £3,000.

If you have investments standing at a gain, it may be worth considering whether disposals before the tax year end could utilise this allowance.

Planning opportunities may include:

• Selling investments to realise gains within the exemption;
• Transferring assets between spouses before a sale to maximise both allowances;
• Reinvesting after disposal if the investment strategy remains unchanged. Note there are anti avoidance provisions so advice is recommended.

Unused CGT exemptions cannot be carried forward, so they are lost if not used before the end of the tax year.

2. Maximise ISA Contributions

ISAs remain one of the most tax-efficient ways to save and invest.
For the 2025/26 tax year, individuals can invest up to £20,000 into an ISA, with all income and gains generated within the account remaining tax-free.

Consider:
• Using any unused ISA allowance before 5 April;
• Reviewing whether investments held outside an ISA could be moved into the tax-efficient wrapper over time.

3. Review Pension Contributions

Pension contributions continue to provide valuable tax relief.

The annual allowance is £60,000, although this may be reduced for high earners under the tapered annual allowance rules.

Benefits of pension contributions include:

• Income tax relief on contributions;
• Potential reduction in taxable income;
• Long-term retirement planning advantages.

It may also be possible to carry forward unused pension allowances from the previous three tax years, subject to conditions.

Note however that pension investments are set to fall within the inheritance tax net with effect from April 2027.

4. Consider Dividend Planning

Owner-managed companies may wish to review dividend payments before the end of the tax year.

The dividend allowance is £500, meaning only a small amount of dividend income is now tax-free.

Planning considerations include:

• Whether dividends should be taken before or after the tax year end;
• Utilising allowances for both spouses where possible;
• Reviewing the balance between salary and dividends.

5. Use the Inheritance Tax Gift Allowance

Individuals can make gifts of up to £3,000 each tax year free from inheritance tax (IHT).

If the allowance was not used in the previous year, it may be possible to carry forward one year, allowing gifts of up to £6,000 which fall outside the IHT net immediately.

Making use of this exemption can be a simple way to start reducing the potential value of an estate over time.

Additional smaller exemptions also exist, including gifts of £250 per person per year.

6. Review Business Asset Disposal Relief Planning

Entrepreneurs considering a future business sale should review their eligibility for Business Asset Disposal Relief (BADR).

The relief allows qualifying gains on business disposals to be taxed at a reduced rate, subject to a £1 million lifetime limit.

With changes expected to increase the BADR tax rate from April 2026, business owners planning a sale in the coming years may wish to review their position and consider whether any advance planning is possible.

7. Check Loss Relief Opportunities

If you have realised capital losses during the year, these should be reported to HMRC on your self assessment tax return so they can be carried forward and used against future gains.

Similarly, businesses experiencing trading losses may have options to:

• Offset losses against other income; or
• Carry losses forward or back depending on the circumstances.

Ensuring losses are properly recorded can provide valuable tax relief in future years.

8. Review Family Tax Planning

Transferring assets between spouses or civil partners is free of capital gains tax, allowing families to make better use of tax allowances and lower tax bands.

This can be particularly useful for:

• Investment portfolios;
• Dividend income; and
• Capital gains planning.

However, transfers should always reflect genuine ownership changes and investment objectives.

Final Thoughts

Tax planning should not be left until the last minute. Taking time to review your financial position before the end of the tax year can help ensure that available allowances and reliefs are used effectively.

Every taxpayer’s circumstances are different, particularly for business owners and entrepreneurs. Seeking professional advice early can help identify planning opportunities and avoid unexpected tax liabilities.

If you would like to discuss your year-end tax planning or review your position before the tax year closes, our team would be happy to assist. Contact partners@rjp.co.uk