UK Tax Planning Guide
A plain-English guide to your Personal Allowance, ISA, pension, dividend and capital gains allowances for the 2025/2026 tax year — plus a free allowance calculator.
Check Your Personal Allowance
Enter your estimated annual income to see your tax-free Personal Allowance, whether it’s being tapered, and which tax band you fall into for 2025/2026.
Personal Allowance Estimator
See how much of your income is tax-free this year.
Key Deadlines
Dates to plan around this tax year
5 April — Tax Year End
The deadline to use annual allowances such as your ISA allowance, pension Annual Allowance and CGT exempt amount before they reset.
6 April — New Tax Year Begins
Fresh ISA, dividend, savings and capital gains allowances become available for the new tax year.
31 October — Paper Return
Deadline for paper Self Assessment tax returns for the previous tax year.
31 January — Online Return & Payment
Deadline for online Self Assessment returns and for paying any tax owed for the previous tax year.
Six Allowances Worth Planning Around
Most UK tax planning comes down to making full use of these annual allowances before they’re lost. A quick overview of each.
ISA Allowance
Save or invest tax-free with no tax on interest, dividends or growth. Unused allowance doesn’t carry forward.
£20,000 / yearPension Annual Allowance
Get tax relief on pension contributions at your marginal rate, plus any employer contributions. Some carry-forward is possible.
£60,000 / yearCapital Gains Allowance
Realise gains on investments or assets each year tax-free before Capital Gains Tax applies, useful for regular rebalancing.
£3,000 / yearDividend Allowance
The first slice of dividend income each year is tax-free, relevant for company directors and shareholders alike.
£500 / yearMarriage Allowance
A non-taxpaying spouse or civil partner can transfer part of their Personal Allowance to a basic-rate taxpaying partner.
Up to £1,260 / yearAnnual Gift Exemption
Gifts made each year fall outside your estate for Inheritance Tax purposes immediately, rather than needing to survive seven years.
£3,000 / year2025/2026 Allowances at a Glance
A summary of the main personal tax allowances and thresholds for the current tax year.
| Allowance / Threshold | 2025/2026 Amount | Notes |
|---|---|---|
| Personal Allowance | £12,570 | Tapered above £100,000; fully removed at £125,140 |
| Basic Rate Band | £12,571 – £50,270 | 20% income tax |
| Higher Rate Band | £50,271 – £125,140 | 40% income tax |
| Additional Rate | Over £125,140 | 45% income tax |
| Personal Savings Allowance | £1,000 (basic) / £500 (higher) / £0 (additional) | Tax-free interest, varies by tax band |
| Dividend Allowance | £500 | Tax-free dividend income per year |
| ISA Allowance | £20,000 | Across all ISA types combined |
| Pension Annual Allowance | £60,000 | Tapered for very high earners; £10,000 if MPAA applies |
| Capital Gains Tax Allowance | £3,000 | Tax-free gains per year |
| Inheritance Tax Nil-Rate Band | £325,000 | Plus £175,000 residence nil-rate band where applicable |
Tax Planning FAQ
Answers to the most frequently asked questions about UK tax planning, allowances and deadlines.
The UK tax year runs from 6 April to 5 April the following year. Many allowances, including the ISA allowance and pension Annual Allowance, are use-it-or-lose-it and reset at the start of each new tax year on 6 April.
For every £2 of adjusted net income above £100,000, £1 of Personal Allowance is removed. This means the standard £12,570 allowance is fully withdrawn once income reaches £125,140, creating an effective marginal tax rate of 60% on income between £100,000 and £125,140.
Pensions offer tax relief on the way in and are generally more tax-efficient for retirement saving, especially with employer contributions, but the money is locked away until at least age 55 (rising to 57). ISAs offer no upfront tax relief but give completely flexible, tax-free access at any time, making them useful for medium-term goals or topping up pension saving.
The ISA allowance cannot be carried forward — unused ISA allowance is lost at the end of the tax year on 5 April. The pension Annual Allowance can be carried forward for up to three previous tax years in some circumstances, provided you were a member of a registered pension scheme in those years.