The end of the tax year is fast approaching, and now is the perfect time to get your clients’ finances in order. We’ve created a handy checklist of tax planning points to consider for clients before the new tax year rolls in.
Many key allowances, like annual ISA and Junior ISA subscriptions and the CGT annual exempt amount are strictly ‘use it or lose it’, so make sure that clients use these.
Reviewing clients’ assets and income streams could provide significant tax savings, perhaps there’s an opportunity to equalise these between spouses or civil partners and help household tax positions.
Making pension contributions or charitable gifts can offer valuable tax relief and reduce clients’ income levels. This lowers the risk of losing personal allowance for those with income above £100,000 or incurring the High-Income Child Benefit Tax charge for those in receipt of Child Benefit and with income between £60,000 and £80,000.
For inheritance tax (IHT) IHT, there are many different exemptions. Each individual has an annual IHT exemption of £3,000. The IHT exemptions don’t change very often, in fact, the annual exemption has been set at £3,000 since it was introduced in 1981. If that had kept up with inflation it would now be around £11,500. That said, this is still a useful exemption because last tax year’s £3,000 wasn’t used, it can be brought forward into this tax year. Potentially, that’s up to £6,000 per person or £12,000 for a couple.
If a client is planning on using the normal expenditure out of income exemption, they can log their income and expenditure details, as well as any gifts, in the IHT403 form. This will help ascertain that they do have surplus income available which is part of the criteria for using this exemption.
Don’t forget that the new tax year brings new tax changes, and from 6 April 2026, we’ll see:
§ Changes in IHT relief for Agricultural and Business property:
– New cap of £2.5m, where qualifying property will get 100% relief - this will be transferrable between spouses / civil partners in a similar way to the IHT nil rate band (NRB)
– Any excess above the £2.5m threshold will only qualify for 50% relief
– Business property comprised of AIM and unlisted share holdings will only qualify for 50% relief, without the £2.5m threshold
§ Dividend basic and higher rates increasing to 10.75% and 35.75% - remember dividends are taxable even if reinvested, so these will need to be reported on self-assessment forms
§ The rate of VCT income tax relief reducing from 30% to 20%. Bear in mind that there’s a tight timescale for those clients wishing to capitalise on this relief before the rate drop and the investment windows close for this tax year.
Click here to explore the implications of the 2025 Autumn Budget for advisers and clients, with insights from our technical experts.
Early conversations and timely action ensures that clients are getting the basics right when it comes to tax efficiency. A proactive approach to the end of the tax year can really make a difference and help clients to secure their future, financially.
At Canada Life, our technical team and account managers are always on hand if you need help. We have a range of different investment products and services that can help your clients plan for their retirement, school fees, manage different pots of money for specific goals or help with estate and inheritance planning. Find out how trusts can help you manage your wealth.
Additional Resources
End of Tax Year Planning Checklist
Liz Hardie, Technical Specialist at Canada Life, shares a practical end of tax year planning checklist to help advisers focus on the key actions to consider before 5 April.