The current tax year officially ends after April 5th 2025, with the following day marking the first date of the 2025/26 tax year.
A little planning could help ensure you are making the most of your hard earned money in the run up to April. We’ve put together an essential tax year end checklist to get you started, covering ISAs, pensions, GIA transfers and more.
Maximise your 2024-25 ISA allowance.
An ISA allows you to save or invest money in a tax-efficient way.
By using your tax-free ISA allowance, you can give your investments more opportunity for potential growth and protect your invested funds from Income and Capital Gains Tax.
Remember, you do not pay tax on:
- Interest on cash in an ISA
- Growth on your investments held in an ISA
Every tax year you can save up to £20,000 in one type of ISA account or split the allowance across some or all of the other types.
You can also pay £4,000 into a Lifetime ISA in a tax year, provided your total yearly contributions do not exceed £20,000 across all your ISAs. You must make your first payment into this ISA before you’re 40.
It’s worth noting that you will lose your annual allowance if you don’t use it, as you can’t carry over anything that’s left from the previous year’s allowance. And although an ISA offers tax-free interest on cash, there is no tax relief on contributions.
The tax year runs from April 6th to April 5th.
Your next steps: You can access your ISA by logging into your True Potential account online or via the app. You can top up from as little as £1 up to your full remaining allowance by using impulseSave®.
Consider utilising your pension allowance.
A pension is a great way to build wealth towards your future retirement goal, and investing early means more time to potentially grow your money.
Your pension contribution limit depends on your income.
You can usually get tax relief on contributions up to the lower of your UK relevant earnings or £60,000; individuals with no earnings or income up to £3,600 gross per year can contribute £3,600 gross.
This is unless the money purchase annual allowance or tapered annual allowance apply and does include both contributions paid by you and contributions paid by your employer.
It’s important to note tax relief is only given on pension contributions if you are eligible – see eligibility here.
You can contribute more than the annual allowance by using ‘carry forward’ – this is when you bring unused allowances from the previous three years into the current year.
It’s very important to check that you have worked out the correct annual allowance amounts available for carry forward. Here, you’re working out the unused annual allowance – not unused tax relief. Remember, pension eligibility and tax rules apply.
While pensions have generous tax benefits, they also have restrictions on how you can access your money; you can’t access your pension until you’re at least 55 (this is set to rise to 57 in April 2028).
If you have any questions or want to talk over your options, please contact your financial adviser for help. You can also get free and impartial information from MoneyHelper.
Your next steps: You can access your personal pension by logging into your account online or via the app. Simply tap the impulseSave® button and top up your investment.
Don’t forget about Junior ISAs.
For many of us, our financial goals are tied in with having a happy home and fulfilling family life. Your investments are one of the key ways you can ensure that your children have a bright future.
A Junior ISA is a tax-efficient way to invest some savings each year for each child you are a parent or guardian to. You won’t pay Income Tax or Capital Gains Tax on the money inside the Junior ISA, no matter how much it grows. For the 2024/25 tax year, the annual contribution limit for Junior ISAs is £9,000.
It’s important to note a child can take control of the account when they’re 16 but cannot withdraw the money until they turn 18. You also can’t have a Junior ISA as well as a Child Trust Fund.
Your next steps: You can top up your Junior ISA on-the-go with impulseSave® – simply login to your account online or via the app and head to your investments.
Tax-efficient opportunities with GIA transfer.
Investing always starts with a goal. Whether it’s for growth, a comfortable retirement, or for the next generation, you’re investing for your future and we’re here to help you reach those goals in the most tax-efficient way possible.
If you have a General Investment Account (GIA) and your ISA or pension have some of their tax-free allowance remaining, this presents you with a tax-efficient opportunity. By transferring funds from your GIA to either your pension, ISA or both, you can help protect more of your hard-earned money from avoidable tax, so you can invest more towards your future goals. It’s important to note that ISA & pension eligibility, subscription limits and tax rules apply.
A switch from your GIA to an ISA will be actioned by selling held assets. This in turn may generate a Capital Gains Tax liability if your capital gains exceed the current allowance of £3,000, so it may be worth consulting with a financial adviser for further guidance.
Your next steps: Log in to your account & access your GIA – you can then click to transfer funds from your GIA to either your pension or ISA, confirm your details and we’ll process the transfer.
To make sure your funds are sold down and reinvested before the tax year ends, the deadline to complete your switch is March 27th.
Corporate impulseSave® for Directors.
Directors of limited companies can contribute directly into a pension from a company bank account by using corporate impulseSave®.
Contributing into a pension from a company account provides one way to invest more for retirement and reduce Corporation Tax. This differs from personal contributions into pensions as personal contributions attract Income Tax relief of at least 20%. If you are a True Potential Wealth Management client, our impulseSave® and corporate impulseSave® technology is at your fingertips, 24/7.
Your next steps: To activate corporate impulseSave®, all you need to do is call our Customer Care team on 0191 500 9164 to verify your access. We’ll do this over the phone so you can start using corporate impulseSave straight away.
Track down and consolidate old pensions.
You’ll likely have several jobs throughout your career. As a result, you may end up with several pension plans in the UK and could mean that you’re paying multiple investment management charges and may not have the most optimal investment.
Pension consolidation is the process of bringing together multiple pension schemes. It is as straightforward as identifying what pensions you have, and then transferring them into one pension provider. Consolidating can make it easier for you to track your progress towards retirement with all your pensions in one place.
However, you may have to potentially pay pension transfer charges or exit penalties with certain providers and this will vary from scheme to scheme. You may also lose access to certain scheme benefits. It’s important to check these details with your existing provider before considering a transfer.
Ultimately, any decision around your pension pot is a big one and speaking to a financial adviser could be beneficial to decide what course of action to take.
Your next steps: Transferring a pension to True Potential is straightforward and can be done over the phone or by video call. You can call our dedicated team on 0191 625 0350 between 7am and 8pm weekdays and 8am to 12pm on Saturdays or book a call back at a time that suits you and we will handle the rest from there.
With investing, your capital is at risk. Investments can fluctuate in value and you may get back less than you invest. This material is not financial advice or a personal recommendation and the investments referred to may not be suitable for all investors.
ImpulseSave® is a registered trademark of True Potential Investments LLP.
Tax is subject to an individual’s personal circumstances and tax rules can change at any time.
ISA eligibility and tax rules apply. You should ensure your contribution does not result in your total ISA contributions within the tax year exceeding £20,000.
Pension eligibility and tax rules apply. You should ensure your contribution does not result in your total pension contributions within the tax year exceeding £60,000 or 100% of your earnings, whichever is lower.
True Potential Wealth Management is authorised and regulated by the Financial Conduct Authority. FRN 529810. Registered in England and Wales as a Limited Liability Partnership No. OC356611.
True Potential Investments LLP is authorised and regulated by the Financial Conduct Authority. FRN 527444. Registered in England and Wales as a Limited Liability Partnership No. OC356027.
True Potential LLP is registered in England and Wales as a Limited Liability Partnership No. OC380771.
