A checklist for tax year end

At a glance

• Make the most of your annual allowances before they reset on 6 April
• There are several ways to use pensions to invest tax-efficiently
• Speak to our wealth experts if you want support ahead of tax year end

It’s understandable that people might be nervous about investing during an unpredictable period for geopolitics, as they don’t want to lose money. Staying on the sidelines and keeping all of your money in cash, however, isn’t necessarily a way to shield your savings from external forces. Inflation can eat away at the value of cash, while you also stand to miss out on potential market returns and the benefits of investing through appropriate tax wrappers.

We’ve set out a checklist for you to consider in the run up to tax year end. The list is not exhaustive, and it may be a good idea to speak to one of our wealth experts to explore your options before the tax year ends. For even more information, you can read our guides to tax year end and tax-efficient investing.

Use your annual allowances

Individual Savings Accounts (ISAs), Lifetime ISAs (LISAs), Junior ISAs (JISAs) and pensions all have annual allowances. This means you can contribute up to the annual allowance in a given tax year, and there may be tax benefits in doing so. Allowances and any tax benefits depend on your personal circumstances and may be subject to change in the future.

Individual Savings Account

• Annual allowance: £20,000
• Age restrictions: 18+
• Key features: Annual allowance can be split between Cash ISA, Stocks & Shares ISA, Innovative Finance ISA, and Lifetime ISA. Cash ISAs and Innovative Finance ISAs are not available at J.P. Morgan Personal Investing. Innovative Finance ISAs are generally considered higher risk
• Tax benefits: Tax-free interest, dividends, and capital gains; tax-free withdrawals

Lifetime ISA

• Annual allowance: £4,000 (part of your £20,000 ISA annual allowance)
• Age restrictions: 18-39 (to open), contributions until age 50
• Key features: 25% government bonus on contributions; for first home (up to £450k) or retirement (age 60+)
• Tax benefits: Tax-free growth; 25% government bonus; tax-free withdrawals for qualifying purposes; 25% government withdrawal charge for non-qualifying withdrawals

Junior ISA

• Annual allowance: £9,000 per child
• Age restrictions: Under 18
• Key features: Opened and managed by parent/guardian until child turns 18;
  accessible by the child only at age 18; converts to adult ISA at 18
• Tax benefits: Tax-free interest, dividends, and capital gains; tax-free withdrawals (from age 18)

Pensions (Personal/Workplace)

• Annual allowance: £60,000 or, if lower, your overall UK relevant earnings
• Age restrictions: You need to be 18 to open a J.P. Morgan Personal Investing Personal Pension; normally accessible from age 55 (rising to 57 in 2028). We do not offer Self-Invested Personal Pensions, including Junior SIPPs
• Key features: Includes employer and employee contributions; tax relief on contributions; 25% tax-free lump sum at retirement
• Tax benefits: Tax relief at your highest marginal rate on contributions; tax-free growth; 25% tax-free withdrawal; remaining 75% taxed as income

The Lifetime ISA allowance of £4,000 counts towards your overall £20,000 ISA allowance, meaning you can contribute up to £4,000 to a LISA and up to £16,000 to other ISA types in the same tax year. For defined contribution pensions, the Annual Allowance may be reduced per tax year by the Money Purchase Annual Allowance (£10,000) if you've already accessed your pension flexibly, or by the Tapered Annual Allowance for high earners (those with income over £260,000). All figures are based on the UK tax year 2026/27 and are subject to change in future budgets. The government plans to reduce the annual allowance for Cash ISAs to £12,000 per tax year in 2027.

With the exception of pensions, your allowances cannot be carried forward into the new tax year. So it’s a good idea to make the most of them while you’ve got them.

A General Investment Account (GIA) may be subject to tax on income – such as dividends and interest – and/or capital gains, where the returns exceed the annual dividend and capital gains tax-free allowances. It can therefore be a good idea to move money from your GIA into an ISA, a LISA or a JISA if you have any unused annual allowances.

Maximise your pension contributions

If you’re a UK taxpayer and under the age of 75, every tax year you may be able to get tax relief on personal pension contributions, whichever is the lowest of:

• Up to 100% of your earnings
• £3,600 if you have no earnings in that tax year
• Contributions up to the government-set annual allowance

While the annual allowance is currently set at £60,000 per tax year, if you are a very high earner you may be affected by the tapered annual allowance.

You can also make pension contributions from unused portions of your previous three tax years by using the pension ‘carry forward’ rules.

Carry forward allows you to receive tax relief on any unused portion of your annual allowance from the previous three tax years, as long as you were a member of a pension scheme during those years.

To use carry forward, you must make the maximum allowable contribution in the current tax year – £60,000 in 2026/27 – after which you can then use any unused annual allowances from the three previous tax years.

It’s important to remember that you’re not able to receive tax relief on contributions in excess of your earnings in a tax year, and you’ll only receive higher rate or additional rate tax relief to the extent you’ve paid the higher rate of tax.

Carry forward may be especially helpful if you'd like to make very large pension contributions, or if you are self-employed and your earnings vary significantly every year.

Make the most of your workplace pension

Maximising your pension contributions before the end of the tax year can help to mitigate against tax on your salary. You could speak to your employer about the possibility of increasing your contribution to your workplace pension scheme, which may prompt an increase in their contribution towards your pension.

Employers can also offer what is known as ‘salary sacrifice’, which is an arrangement that allows employees to take a lower pre-tax salary in exchange for other benefits.

One common salary sacrifice arrangement involves agreeing to a reduced salary, with your employer contributing the difference directly into your pension. This can increase the value of your pension savings and can also reduce your taxable income, resulting in savings in both income tax and National Insurance Contributions (NICs).

From April 2029, only the first £2,000 of employee pension contributions through salary sacrifice each tax year will be exempt from employer and employee NICs. Employee contributions above this amount will be subject to NICs. Contributions through salary sacrifice, like all pension contributions, will still be exempt from Income Tax (subject to the usual limits).

Pay into your partner’s pension

You could consider paying into your partner’s pension. If your partner is female and they have not been able to contribute as much as they would have liked to their own pension, this can help to reduce the gender pensions gap. In the period of 2020 to 2022, the gender pensions gap between male and female private pensions for those aged 55-59 in Great Britain was 48%, according to the UK government. This gap can exist for a number of reasons, such as women often having to take breaks from earning due to caring responsibilities.

You can pay up to £2,880 per tax year into the pension of a non-earning person, who will receive a government top up of 20% via tax relief. If the recipient is working, the amount that you can pay into their pension is capped at £60,000 or 100% of their earnings, whichever is lower. Your contributions must remain below your partner’s annual pensions allowance.

Beyond your partner’s pension, you could explore making use of the Marriage Allowance. This allows you to transfer £1,260 of your Personal Allowance – the amount you can earn before paying tax – to your wife, husband or civil partner. This can lower their tax by up to £252 in a tax year, although to benefit as a couple, the lower earner must normally have an income beneath the Personal Allowance. The standard Personal Allowance is £12,570, although this falls if you earn more than £100,000.

Use your Capital Gains Tax allowance

Currently, an individual can make total gains of £3,000 per tax year on assets they have sold or ‘disposed’ of before they pay Capital Gains Tax (CGT).

For example, if you were to buy a piece of art for £5,000 and later sell it for £20,000, you will have made a £15,000 gain on the asset, and you may need to pay CGT on this £15,000 sum. Assuming you’ve ‘disposed’ of no other assets in the current tax year, you would need to pay CGT on £12,000 – the capital gain (£15,000) less the CGT allowance (£3,000).

The CGT rate for basic rate taxpayers is 18%, while higher and additional rate taxpayers face a rate of 24%.

Look to ‘Bed and ISA’

A Bed and ISA transfer involves moving investments that you own outside your Stocks and Shares ISA (for example, in a General Investment Account) into this tax-efficient wrapper.

These investments cannot be transferred directly, so you sell the investments outside the ISA and simultaneously buy the same investments back within the ISA.

The aim is to end up with the same portfolio as before, but with everything inside an ISA wrapper. Once the transfer has taken place your investments will be free of tax on any potential growth or returns.

If you carry out a Bed and ISA transaction, this must be done within your £20,000 a year annual ISA allowance. If you have more money in your GIA to transfer into an ISA, you can redistribute more funds into your ISA in the next tax year.

For example, if you have already contributed £4,000 to an ISA in that tax year, and have £20,000 in a GIA, the most you could redistribute from your GIA to your ISA would be £16,000. You'd have to wait until the new tax year to add the remaining £4,000 from your GIA.

If you sell shares or funds outside an ISA for more than you bought them for, you may also trigger CGT. In order to complete a Bed and ISA transfer with us before the end of the 2026/27 tax year, customers should check the indicative dates for completing transfers here.

Reduce your Inheritance Tax liability

If you want to leave wealth to children or other members of your family, it’s worth noting that you can currently give away a total of £3,000 per tax year that will not attract Inheritance Tax (IHT). This is also known as your ‘annual exemption’.

You can give money or gifts up to £3,000 to one person or divide the £3,000 between several people. You can also give unlimited gifts of up to £250 per person every tax year, provided that you have not used another allowance on the same person.

Speak to our wealth experts

Ensuring that your cash and your investments work together in a tax efficient way isn’t always straightforward. Our wealth experts can help you explore how you could invest more tax-efficiently while making the most of your annual allowances. You can book a call to speak to one of our experts for free.

Further reading

What is tax year end and why is it important for investors?

Guide to tax-efficient investing