A Practical Tax Planning Guide Before 5 April 2026

Effective tax planning is about timing, structure and using allowances before they’re lost. The following areas should be reviewed well ahead of the 5 April 2026 tax year end. Income tax & allowances Maximise use of the personal allowance (£12,570) and basic rate band across family members where income splitting is commercially justified Use the dividend allowance (£500) and personal savings allowance (£1,000 for basic rate taxpayers, £500 for higher rate taxpayers) before year end Consider the timing of bonuses and discretionary income, particularly where income is approaching £100,000 (personal allowance withdrawal) or £125,140 Accelerate or defer income receipts based on expected tax rates and personal circumstances in 2026/27 Capital gains tax planning Use the annual exempt amount (£3,000 per individual) before 5 April 2026 — losses cannot be carried back Consider bed-and-breakfasting alternatives, such as ISA reinvestment or spouse transfers, to refresh CGT base costs Review disposals where Business Asset Disposal Relief may apply (lifetime limit £1 million, taxed at 14%, subject to qualifying conditions) Crystallise capital losses before year end to offset current or future gains (losses carry forward indefinitely but current year losses must be used first) For residential property disposals, note CGT rates of 18% or 24% and the 60-day reporting and payment requirement Pension contributions Maximise pension contributions up to the £60,000 annual allowance and use carry-forward relief from the previous three tax years High earners with adjusted income over £260,000 should review the tapered annual allowance, which can reduce to £10,000 Employer pension contributions avoid employer NICs (now 15%) and remain deductible for corporation tax Review exposure to the money purchase annual allowance (£10,000) if pension benefits have already been accessed Tax-efficient investments Use ISA allowances (£20,000 per individual) and Junior ISA allowances (£9,000 per child) — unused allowances cannot be carried forward Consider venture capital schemes where appropriate: SEIS: up to £200,000 at 50% income tax relief EIS: up to £1m (£2m for knowledge-intensive companies) at 30% relief VCTs: up to £200,000 at 30% relief Review availability of loss relief on EIS and SEIS investments, which can be set against income as well as gains Corporate planning for directors and companies Review the optimal mix of salary and dividends, particularly following the increase in employer NICs to 15% from April 2025 Consider timing of capital expenditure to maximise relief under the £1m Annual Investment Allowance or full expensing rules Review group relief opportunities where companies have differing year ends Monitor director loan accounts — balances over £10,000 can trigger benefit-in-kind charges, and outstanding loans may attract a 33.75% s455 charge Inheritance tax planning Use the annual gifting exemption (£3,000, plus prior year if unused) and small gifts exemption (£250 per recipient) Structure regular gifts from surplus income to qualify for immediate exemption, ensuring appropriate records are kept Consider potentially exempt transfers now to start the seven-year clock Review Business Property Relief and Agricultural Property Relief eligibility and ownership periods Check life assurance policies are written in trust where appropriate Property & SDLT considerations Review property portfolios for potential disposals ahead of future tax changes Consider incorporation of property businesses, balancing SDLT costs (including the 3% surcharge) against long-term corporation tax savings Cross-tax and administrative planning Review salary sacrifice arrangements for pensions, childcare and cycle-to-work schemes Time charitable donations to maximise Gift Aid relief Review VAT schemes (flat rate, cash accounting or annual accounting) where relevant Check HMRC coding notices and payments on account Ensure self-assessment obligations are planned for ahead of the 31 January 2027 deadline

Income tax & allowances

Capital gains tax planning

Pension contributions

Tax-efficient investments

Corporate planning for directors and companies

Inheritance tax planning

Property & SDLT considerations

Cross-tax and administrative planning

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