Still time to get your financial plans updated

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The start of the new tax year is 6 April – next Sunday – so it’s time to ensure everything is in place when it comes to your personal financial matters.

While the Spring Statement from Rachel Reeves on Wednesday did little to impact wealth planning, some of the changes announced in last year’s Autumn Budget will start to take effect in the coming months.

Cameron Stewart, chartered financial planner at Aberdein Considine Wealth, says: “As the new tax year begins, now could be the perfect moment to review your finances and make the most of tax-saving opportunities.“Contributing to your pension early can help reduce taxable income, especially with the £60,000 annual allowance in place.

“If you haven’t yet used your £20,000 ISA allowance, now may be a great time to take advantage of tax-free savings and growth.”

Cameron also explains how planning ahead can also help minimise tax bills, especially with the Capital Gains Tax (CGT) exemption due to drop from £6,000 to £3,000 in 2026/27, and the Dividend Allowance reducing from £1,000 to £500 next year.

Andy Bolden, financial planning director with 7IM, points out that it is only12 months from now until a major change to Inheritance Tax (IHT) rules takes effect. He says: “From April 2026, anyone holding assets qualifying for business or agricultural property relief will be faced with some decisions to make. So it is best to assess and review your circumstances as soon as possible, to take advantage of the next 12 months to make planned changes in good time.

“Many individuals will be getting a pay rise this month, and moving into higher Income Tax bands in Scotland due to the general freeze on personal allowances and higher-rate bands. Even more important, therefore, to mention the usual prompts to review and consider all of your personal annual allowances for ISAs and pensions.”

Michael Angus, chartered financial planner at atomos Wealth, comments: “Making the most of your pension is important. If you’re contributing to a SIPP or personal pension, the good news is that you get tax relief on your contributions at the highest rate of Income Tax that you pay. Pension tax relief automatically tops up your own contribution by 20 per cent. But if you are a Scottish higher-rate taxpayer paying tax at 42 per cent, you can claim, via your self-assessment, an additional 22 per cent tax relief. The same principle applies to intermediate and top-rate taxpayers too.”

Foster Denovo financial adviser Aaron Steel highlights the fact that unused pensions are to be brought into scope for IHT from April 2027.

He says: “You can prepare now. Perhaps by nominating children now – so they’ll benefit ahead of the deadline should you pass away – and then revert to your spouse or civil partner right before this comes into force in April 2027, to be exempt from IHT via the spousal exemption. In both cases, IHT would not apply.

“Also, using the annual gift allowance to pay into a pension for a child or grandchild offers immediate IHT relief for the donor, and Income Tax relief for the recipient – even at 20 per cent, if they are a minor – a win-win.”

According to Shaun Robson, partner and head of wealth planning at Killik & Co., the start of a new tax year presents an excellent opportunity to reflect on financial strategies and make adjustments to maximise tax efficiency. By taking proactive steps, he says, individuals and families can not only make the most of their tax allowances, but also set themselves up for a more secure financial future.

His key considerations include using family-wide tax allowances, leveraging gifting rules to reduce taxable estates, replenishing withdrawn ISA funds to retain tax-free growth, and taking full advantage of the current CGT allowances before they reduce further.

Shaun says: “The start of any new year offers the opportunity to reflect and goal-set, and people should take the time to inspect their finances to not only to prepare for the year ahead but also to ensure they’ve made the most of the one that has just been.”

He lists four things any “savvy saver” should consider as the end of the tax year looms:

1. Utilise family-wide tax allowances.

2. Use gifting allowances.

3. Replace ISA withdrawals (if your provider allows it).

4. Use your CGT allowance.

Shaun adds: “Families often miss out on the full spectrum of tax allowances available to them. By working together, they can pool resources and strategically utilise options like ISAs, Junior ISAs, and Stocks and Shares ISAs. Each adult in the UK has an annual ISA allowance of £20,000, while Junior ISAs allow parents or grandparents to contribute up to £9,000 per child annually, growing investments tax-free.

“One of the most effective ways to reduce the size of your taxable estate is through gifting. Regular and early gifting allows you to pass on wealth while taking advantage of the current IHT rules.

“Each individual has an annual gifting allowance of £3,000, which can be doubled if unused from the previous tax year.

“Additionally, small gifts of up to £250 per person are exempt, as are wedding gifts, within specified limits.

“Beyond these allowances, the ‘seven-year rule’ can help families make larger gifts. If a gift is made more than seven years before the donor’s death, it is generally exempt from IHT.

“However, gifts made within this period may be subject to taper relief, which reduces the tax owed over time. Starting this process earlier not only maximises the chance of surviving the seven-year window, but also allows wealth to grow in the hands of younger generations.”

Jennifer Davy from financial advisers Clark Gillone urges people to check their tax code – the baseline on which earnings are taxed. She explains: “Most people in Scotland have the tax code S1257L which reflects the full personal allowance, £12,570 in 2025/26. A different number or letter means your personal allowance has increased, decreased or is subject to emergency tax. Worth a call to HMRC if you’re in any doubt.

“Give your spending a health check. If you haven’t already set financial goals for the year, there’s no better time to think about what’s important and work out a plan to achieve it. Look at income and expenditure and subscriptions you may not need any more, and if you have any spare funds that could be working harder for you, consider savings, investments, or paying off debt.

“For families, make sure you’re claiming child benefit – it also counts towards your state pension entitlement, so it helps your finances here and now as well as in the future.”

Looking ahead, Iain Bryson, director at McHardy Private Wealth, says the world is entering a new period for investment markets after the great returns experienced in 2024.

He says: “Sometimes it’s difficult to identify why markets have moved but recent negative movements are directly linked to the new American Government’s erratic trade wars – ‘to protect American jobs’ –which have led to US consumer confidence dropping, manufacturers seeing a fall in orders, public sector job losses, and demand for new employees also falling.”

Iain adds that many investment portfolios will have a large exposure to the US stock market and US firms make up about 50 per cent of the world’s equity market cap, so what happens in that market really matters.

He concludes: “Whilst it is difficult seeing your investment portfolios fall in value in quick time, history has told us to remain invested and wait out for positive growth to return. The world’s largest economy has not turned its back on capitalism and the underlying businesses you are invested in remain strong despite the headwinds they are currently facing.”