10 Things to do before the end of the Tax Year

As the end of the tax year approaches, there is a limited window to take full advantage of available tax breaks, allowances, and financial planning opportunities. Acting now can help ensure you are making the most of your savings and investments.

10 Things to do before the end of the tax year

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1. Use your ISA allowance

One of the most valuable allowances to utilise before the end of the tax year is the Individual Savings Account (ISA) allowance. ISAs allow you to save or invest up to £20,000 per year tax-free, and if you do not use your allowance before the tax year ends, you lose it. This means you cannot carry over any unused portion into the next tax year. If you have not yet maximised your ISA contributions, now is a good time to do so. 

2. Transfer your ISA?

While making use of your unused ISA allowance you could also consider whether your existing ISA arrangements continue to be appropriate. Transferring funds from a Cash ISA to a Stocks and Shares ISA does not count towards your annual ISA allowance. You may want to consider transferring your Cash ISAs to a Stocks and Shares ISA to potentially achieve better long-term growth. However, this depends on your personal financial goals and risk appetite. It’s important to fully understand the risks involved and seek independent financial advice if necessary before making any decisions.

3. Pension contributions

Pension contributions are another key area to review before the tax year ends. Making the most of pension tax relief can significantly enhance your retirement savings. Contributions to pensions receive tax relief at your marginal rate, meaning higher-rate and additional-rate taxpayers receive substantial benefits. If you have not yet used your full annual allowance of £60,000, you may also be able to carry forward unused allowances from the past three years – subject to your relevant earnings in those years and provided you were a member of a pension scheme during that time.  Checking your contributions now and making any additional payments before the deadline can help you maximise the tax advantages available.

4. Reduce your Capital Gains Tax

Capital Gains Tax (CGT) planning is also worth considering. Each individual has an annual CGT allowance, which for the 2024/25 tax year stands at £3,000. If you are planning to sell assets such as shares, property, or other investments, you may want to do so before the end of the tax year to take advantage of this exemption. Spreading the sale of assets over multiple tax years or transferring assets to a spouse or civil partner can also help reduce overall tax liability, provided it is a genuine gift. Reviewing your investment portfolio now could identify opportunities to realise gains while minimising tax exposure.

5. Charitable giving

Charitable giving is another area where tax efficiency can be maximised. Donations made through Gift Aid allow charities to reclaim basic-rate tax on your contributions, and higher-rate taxpayers can claim additional relief through their tax return. If you are considering making charitable donations, doing so before the tax year ends ensures that any applicable tax relief can be claimed in this tax period. This not only benefits the causes you support but also provides an opportunity to reduce your tax bill.

6. Business owners & Self-employed

For business owners and self-employed individuals, it is important to review income and expenses before the tax year closes. Ensuring all allowable expenses are claimed can reduce taxable profits and overall tax liability. Making pension contributions through a business can also provide tax-efficient savings while reducing the company’s taxable income. If your business has made a profit, considering investments in capital expenditure before the end of the tax year may allow you to take advantage of available tax reliefs. However, accountancy advice should be sought before going down this route.

7. Use personal allowances

Using personal allowances efficiently is another important step before the tax year ends. Every individual has a tax-free personal allowance, and for those who are married or in a civil partnership, the Marriage Allowance or transferring assets between spouses can help optimise tax efficiency. Reviewing how income and assets are structured within a household can help ensure that all available allowances are fully utilised.

8. Junior ISA allowance

If you have children, making use of the Junior ISA allowance is another way to maximise tax-efficient savings. You can contribute up to £9,000 per tax year into a Junior ISA, helping to build a long-term financial foundation for your child while benefiting from tax-free growth. Those considering financial gifts to children or grandchildren should also be aware of the annual gifting allowance of £3,000, which allows individuals to make tax-free gifts without being subject to inheritance tax.

9. Make the most of all allowances & reliefs

With the end of the tax year fast approaching, taking action now can ensure that you are making the most of the allowances and reliefs available to you. The tax system is complex, and missing out on valuable opportunities can mean paying more tax than necessary. A financial adviser can help navigate the various options, ensuring you make informed decisions tailored to your financial situation and long-term goals. Seeking professional advice can also provide peace of mind, ensuring you are fully compliant with tax regulations while optimising your financial position.

10. Take professional financial advice

Time is running out, but there is still an opportunity to make strategic financial decisions before the tax year ends. Reviewing your savings, pensions, investments, and allowances now will put you in a stronger position for the future. If you are unsure about the best course of action, consulting a financial expert can help you take full advantage of the tax-saving opportunities available before it is too late.

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The Financial Conduct Authority (FCA) does not regulate tax advice or estate planning.

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

Investment returns are not guaranteed, and you may get back less than you originally invested.