As we approach the final weeks of the 2025/26 tax year, the "Use It or Lose It" klaxon is sounding. For company directors and the self-employed—particularly those over the age of 55—this is the critical window to mitigate heavy tax liabilities and ensure your hard-earned wealth stays where it belongs: with you and your family.
If you are currently facing a significant tax bill or looking at your end-of-year accounts with a sense of dread, now is the time to act. Here are the top five strategic actions you should consider before the 5th of April deadline.
1. Maximise Pension Contributions (The 55+ Advantage)
For those over 55, the pension remains one of the most efficient tax-planning tools available. If you are a high-earner or a company director, personal or business contributions can significantly reduce your Corporation Tax or move you out of the higher (40%) or additional (45%) income tax brackets.
• The Action: Review your remaining Annual Allowance. If you haven't used your full allowance from the previous three years, you may be able to 'carry forward' those figures to make a substantial, tax-efficient contribution this year.
2. The Dividend vs. Salary Balance
With dividend allowances having tightened in recent years, the balance between salary and dividends is more nuanced than ever.
• The Action: Ensure you have utilised your £500 dividend allowance. If you are a director-shareholder, we should look at whether a year-end dividend declaration is more tax-efficient than a bonus, or vice versa, based on your total income for 2025/26.
3. Utilise Your ISA Allowance
The £20,000 ISA allowance is a "use it or lose it" perk. Any part of the allowance not used by midnight on 5th April is gone forever. For those over 55 thinking about retirement, the tax-free growth and tax-free withdrawals of an ISA are vital for a flexible income strategy.
• The Action: Top up existing ISAs or open a new one to ensure you aren't leaving tax-free growth on the table.
4. Capital Gains Tax (CGT) Planning
The CGT annual exempt amount is currently £3,000. If you are planning on selling business assets or personal investments, it may be wise to realise gains (or losses) before the tax year turns.
• The Action: If you have assets with significant gains, consider whether "Bed and ISA" strategies or staggered disposals can help you stay within your allowances and minimise the hit from HMRC.
5. Inheritance Tax (IHT) and Gifting
For established business owners over 55, wealth preservation is often as important as wealth creation. You have an annual gifting allowance of £3,000 that can be moved out of your estate immediately for IHT purposes.
• The Action: Use your annual gift allowance. If you didn't use last year’s, you can carry it forward for one year only—meaning you could potentially move £6,000 out of your taxable estate right now.
A Note to My Professional Partners in Accountancy
I know that this is your busiest time of year. As you sit down with your clients to file their end-of-year accounts, you may identify individuals who are frustrated by their tax liabilities or who lack a clear roadmap for their post-business life.
Accountancy tells the story of what has happened; Financial Advice writes the script for what happens next. If you have clients who need a specialist eye to help them navigate these five actions—and more complex retirement planning—I am here to help. Let's work together to ensure your clients get the best possible outcome before the April deadline.
Don’t Leave it to Chance
Tax planning shouldn't be a last-minute scramble, but with the deadline looming, decisive action is required. Whether you are a business owner looking to optimise your position or an accountant seeking a trusted partner for your clients, let’s talk.
Get in touch with Alec Cameron at Advice2U today for a confidential consultation.
The value of investments can go down as well as up and you may not get back the full amount you invested. The Financial Conduct Authority does not regulate Tax Advice.
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