Jeremy started his new position with Anthony Gold on April 1st and the new Tax year started four days later. Here he highlights what's changed and what hasn't. If you think you need advice on the issues raised, do get in touch with Jeremy.
As we enter the new tax year, what do you need to know?
What is income tax and national insurance?
Income Tax rates remain unchanged, as do National Insurance payments for employees. Significantly personal allowances and additional rate thresholds are also unchanged meaning that increases in pay or taxable benefits such as State Pension are likely to be taxed.
The personal tax-free allowance remains at £12,750. Taxable income above that level is taxed at 20% and anything above £50,270 is taxed at 40%. If you receive more than £125,140 this is taxed at 45%.
| Tax Band | Taxable Income (£) | Tax Rate |
| Personal Allowance | Up to £12,750 | 0% |
| Basic Rate | £12,751 – £50,270 | 20% |
| Higher Rate | £50,271 – £125,140 | 40% |
| Additional Rate | Over £125,140 | 45% |
What can I do to reduce these taxes?
The Personal Savings Allowance remains in place so basic rate taxpayers can ear £1,000 of interest on savings before being taxed. For higher rate taxpayers this is reduced to £500 and there is no allowance for additional rate taxpayers.
You can also still save up to £20,000 this year in ISAs which are exempt from income tax. These can be in either cash or investments but there is lots of talk about the cash ISA limit being restricted or abolished in future years so if you prefer the certainty of a cash investment receiving interest it will be worth considering that this year.
What is capital gains tax?
The amount you can make on sales of assets before having to pay tax has reduced in recent years but remains at £3,000 for 2025/26. However, the rates of Capital Gains Tax have increased for basic rate taxpayers to 18% and for higher and additional rate taxpayers to 24%. These changes unusually came in during the previous tax year from 30 October 2024.
| Taxpayer Type | CGT Rate on Gains | Annual Exempt Amount |
| Basic Rate | 18% | £3,000 |
| Higher / Additional Rate | 24% | £3,000 |
What are pension payments?
Contributions to personal pensions continue to attract tax relief and so remain a way of lawfully avoiding tax while making provision for your future. The maximum contribution for this tax year, including payments made by your employer, if relevant, remains at £60,000.
If you are receiving pension payments, as mentioned above, the increase of 4.1% from April 2025, while welcome, may have taken you from not having to pay tax to being liable to tax. The new flat-rate state pension paid to those who reached state pension age after April 2016 is now £230.25 a week which is £11,973. If this, together with other untaxed income, takes you above the personal allowance of £12,750 then you may have to consider the need to submit self assessment tax returns for the first time. If you need advice on this, do get in touch with us.
Future years
As mentioned above, the new Chancellor sprung a surprise by making immediate changes to the Capital Gains Tax rates in her first budget rather than announcing them in advance to come into place from the start of the next tax year. This is not a unique circumstance but now that the date of the budget seems to have changed back to the Autumn rather than Spring it is possible immediate changes might become more common. So don't think that the tax regime is set in stone till April 2026.
Also, we have had advance notice of changes to Inheritance Tax from April 2026 and April 2027. More to follow on these issues.
Originally published 22 April 2025
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
