Use them or lose them

Make sure you’re not paying more tax than necessary by taking advantage of all your annual allowances before the end of the tax year.

By Rathbone Financial Planning 16 February 2024

With the end of the tax year on 5 April 2024 around the corner, now is the perfect time to give your finances a spring clean. One of the most important things you can do is to make sure you’ve used your annual allowances. You can’t carry most of these over to next year so you’ll lose their benefits if you don’t take full advantage.

For example, ISAs are an important source of tax-efficient income for many people, including those who have retired, and you can save up to £20,000 each year. With the annual tax-free dividend allowance of £1,000 falling to £500 from 6 April 2024, saving into an ISA can help to mitigate the impact of this reduction.

When it comes to pensions, rules surrounding contributions are complex, particularly if you’re a high earner, and it’s almost always a good idea to seek advice. For example, you may be able to roll over any unused allowances from the previous three tax years. However, exceeding your annual or lifetime allowance can be costly.

Find out more

Find out more about annual allowances in our handy checklist. These measures are not exhaustive and there are other tax allowances available. If you would like to find out more about improving your tax position or making the most of your allowances, then please speak to your Rathbones contact or get in touch.