New Tax Year, New Structure: What Should You Review in Your Finances Now?

The start of a new tax year is more than a reset of allowances – it is a chance to take stock of what has been done and what still needs attention. As highlighted in our end of the UK tax year checklist, many valuable allowances are use-it-or-lose-it. Once the deadline passes, the focus shifts from maximising last year’s opportunities to structuring the year ahead effectively.

A well-timed review can help ensure your financial planning remains proactive rather than reactive, reducing the risk of missed opportunities later.

Here are the most important points to consider at the start of the tax year.

Individual Savings Accounts remain a cornerstone of tax-efficient wealth management. With a fresh £20,000 allowance now available, the new tax year is the ideal time to plan contributions early rather than leaving them until the deadline.

If you maximised your allowance before April, consider whether:

• Your current ISA investments still align with your long-term goals
• Monthly contributions could help smooth market timing
• You should rebalance your portfolio based on performance or risk

Starting early allows more time for compounding growth, which can significantly enhance long-term outcomes.

This is particularly relevant in the current environment, with the ISA allowance reducing to £12,000 from 6 April 2027 for individuals under 65. This makes forward planning even more important, as making full use of allowances while they remain available could have a meaningful long-term impact.

The Junior ISA allowance for the 2026/2027 tax year is £9,000. It offers an effective way to build capital for your children, whether for future education costs, a deposit on a first home, or long-term financial security. If you have surplus capital available, this allowance can provide a valuable opportunity to invest in their future in a tax-efficient manner.

Allowances for dividend income and savings interest reset each year, but thresholds remain relatively modest. The dividend allowance for 2026/2027 is just £500, making dividends a limited tax shelter before dividend tax becomes payable.

If you hold substantial taxable portfolios or business interests, dividend tax exposure requires active management. Careful coordination between salary, dividends, and investments is essential.

Now is a good time to:

• Review how your income is structured
• Consider whether assets should be moved into ISAs or pensions
• Ensure cash holdings are not creating unnecessary tax exposure

Small adjustments early in the year can lead to meaningful efficiencies over time.

The new tax year is also an opportunity to revisit wealth protection and estate planning strategies. Allowances such as gifting exemptions and the marriage allowance can be used again, offering continued scope for tax-efficient planning.

You can give away up to £3,000 each tax year free of inheritance tax, with any unused allowance carried forward for one year. Regular gifts made out of surplus income may also fall outside your estate, subject to certain conditions. Used consistently over time, these gifting allowances can gradually reduce the value of your taxable estate.

Consider:

• Setting up regular gifting strategies
• Reviewing how assets are distributed between spouses
• Ensuring records are maintained for future estate planning

While each allowance may appear modest in isolation, when used collectively and consistently, they can have a meaningful impact on long-term outcomes. Over time, this approach can help reduce inheritance tax exposure while supporting broader family financial goals.

At the same time, it is important to be aware of evolving rules around pensions and inheritance tax. Most unused pension funds and certain death benefits will be brought within the scope of inheritance tax from 6th April 2027 and potentially taxed at 40%. Historically, pensions could often be passed on outside of your estate, making them a valuable intergenerational planning tool. This shift changes how retirement wealth should be considered within your wider estate planning strategy, particularly if you do not expect to fully draw on your pension during your lifetime.

If you have access to salary sacrifice schemes, the beginning of the tax year is often when elections or adjustments can be made.

Options such as pension contributions, cycle schemes, or electric vehicles can improve tax efficiency while supporting personal priorities. Reviewing these early ensures you benefit across the full tax year, rather than part of it.

Financial decisions are most effective when viewed as part of a wider strategy rather than in isolation.

At the start of the new tax year, this means:

• Setting clear priorities for the months ahead
• Aligning tax planning with long-term objectives
• Avoiding last-minute decisions under pressure

A structured approach can help you stay on track and make more informed choices throughout the year.

The new tax year offers a clean slate, but also a valuable opportunity to build on the actions you have already taken. By reviewing your position now and setting a clear direction, you can make better use of allowances, improve tax efficiency, and strengthen your long-term financial strategy.

If you are based in the UK and haven’t recently reviewed your financial plan with your Hoxton Wealth adviser, now is a great time to make an appointment.

If you don’t have an adviser but would like guidance in aligning these areas with your wider financial picture, find out how we at Hoxton can help bring structure and clarity to your plans for the year ahead by booking a call today.