Tax planning tips 2025/26
The new tax year has brought mainly challenging news for taxpayers and business owners. Personal tax allowances and income tax bands remain frozen, effectively raising taxes by the operation of inflation. In addition, employers now have to pay employer NICs at the rate of 15% (up from 13.8%), with the starting point reduced to £5,000 (down from £9,100). Landlords have lost the tax advantages associated with furnished holiday letting, although there are still some non-tax benefits with this type of property letting. Taxpayers in Scotland are also faced with frozen thresholds for the higher rates of Scottish income tax.
The main rates of capital gains tax (CGT) were increased in October 2024, and from 6 April 2025 the rate of tax on qualifying business assets increased from 10% to 14%, with a further increase to 18% to come in a year’s time.
The government has also announced several inheritance tax (IHT) changes well in advance of their introduction. From April 2026, the 100% relief for shares in unlisted trading companies will be restricted to a maximum of £1 million. Then, from April 2027, unused pension funds will be included in the value of the deceased’s estate (unless the funds are inherited by a spouse or civil partner). To top it off, IHT nil rate bands will be frozen until April 2030 rather than April 2028.
This guide highlights 50 ways in which you can currently use certain tax reliefs to your advantage, and how to avoid some of the tax penalties. It can help you navigate the complexity of certain tax rules and create more tax-efficient plans.
Covered in this publication:
- Personal and family tax planning
- Savings and investment
- Your property
- Retirement planning
- Estate planning
- Your business
- Employment and remuneration
