Make sure you’re keeping up
It’s important to make sure you keep up with any changes to savings and estate planning rules. We can help you take action to make sure your finances are as tax-efficient as possible.
This checklist shows how some of these changes may affect your finances.
What’s changed with Income Tax
The Personal Allowance (PA) and basic rate limit are to be fixed at their current levels up to and including 2030 to 2031 tax year. It will set the PA at £12,570, and the basic rate limit at
£37,700 for the same period. With these changes it will mean that more people will be dragged into taxation or paying a higher rate of tax.
Personal tax thresholds being frozen since does mean that inflation erodes their real value.
What’s changed with the Savings Allowance?
The Personal Savings Allowance remains unchanged for 2025/26. The Personal Savings Allowance also remains unchanged for 2026/27. Basic-rate taxpayers can still earn £1,000 interest on savings before tax. For higher-rate taxpayers, the allowance is £500, and for additional-rate taxpayers, it’s zero. But if you do pay tax on savings interest, what you pay will rise by 2 percentage points from April 2027.
ISAs remain unchanged (this year)
Your tax-efficient ISA allowance is still £20,000 for 2025/26 (and will be unchanged for 2026/27), both Stocks & Shares ISAs and Cash ISAs. Topping up before tax year-end is always a good option. From April 2027 the Cash ISA limit will be reduced to £12,000 if you’re below 65.
The Junior ISA annual allowance also remains unchanged at £9,000. Alongside children’s pensions, Junior ISAs are a great way to give your children or grandchildren a financial head start. If you’re saving into a mixture of cash savings accounts and ISAs, now could be a good time to review which ones are performing better.
Personal pensions – much has changed
From April 2027 unspent pension pots will no longer sit outside your estate – and could potentially be liable for 40% Inheritance Tax (IHT).
Farmers and landowners will also be affected with any agricultural land and qualifying assets worth over £2.5m from April 2026, making them potentially liable for IHT for the first time.
Pensions continue to be a tax-efficient, long-term savings option and paying into a pension can still be a great way to save for your retirement. The good news is eligible pension contributions continue to get a cash boost from the government in the form of tax relief.
The standard annual allowance for pension contributions (the maximum total pension contribution you, your employer or a third party, can make and receive the full benefits of tax relief in a year) remains at £60,000. Tax relief on personal contributions is limited to up to 100% of your relevant earnings in the tax year (up to £60,000), or £3,600 if you do not have any relevant earnings.
The value of pensions and investments and the income they produce can fall as well as rise and you may not get back the full amount that you originally invested.
The favourable tax treatment of ISAs may be subject to changes in legislation in the future.
Levels and bases of, and reliefs from, taxation are subject to change and their value will depend upon personal circumstances. Taxation and pension legislation may change in the future.