In our experience, there’s a familiar pattern for many when it comes to tax planning. For most of the year, it sits in the background. It doesn’t feel urgent. Then March arrives. The deadline is close, everything speeds up, and there’s a push to get things done before 5 April – using allowances, confirming contributions, making sure nothing is missed.

Why it happens

The tax year ends on 5 April, so anything you want to count for that year needs to be done by then. Most allowances don’t carry forward – if they’re not used, they’re gone.

And for most of the year, there’s no pressure to act – so it’s easy for it to sit in the background until the deadline brings it forward.

Why leaving it until March limits your options

When everything happens at the end of the tax year, the question becomes: ‘What can we still do in time?’

That usually means:

• Topping up pensions
• Using ISA allowances
• Realising gains

All of which can be sensible. But some of the more effective decisions don’t sit in that final window. They rely on timing – spreading actions across the year, aligning with income, or making decisions before money is received.

By March, you’re mostly working with what can be done quickly.

How to avoid the year-end rush

The tax year resets on 6 April, so that gives you a full 12 months to use your allowances.

Getting ahead isn’t about doing everything immediately. It’s about not leaving everything until the last few weeks.

What resets on 6 April

What matters is how – and when – these are used.

What to factor in for 2026/27

A few changes coming in from April 2026 reduce how much you can adjust at the end of the tax year:

Dividends are costing more

From 6 April 2026, dividend tax rates increase:

• 10.75% (basic rate)
• 35.75% (higher rate)
• 39.35% (additional rate)

With the allowance still at £500, most dividend income is already taxable. For someone taking income through a mix of salary and dividends, that shift alone can add around £1,000 of extra tax over the year.

Once that income has been taken, there’s very little you can change.

Relief on business assets is no longer unlimited

From April 2026, Business Property Relief and Agricultural Property Relief are capped.

You can still get 100% relief, but only up to £2.5 million per person (or £5 million for a couple). Above that, relief drops to 50%, leaving part of the value exposed to inheritance tax.

AIM-listed shares move to a flat 50% relief, regardless of value.

Selling a business becomes more expensive

The rate under Business Asset Disposal Relief rises from 14% to 18% from April 2026.

On a £1 million gain, that’s an extra £40,000 in tax.

Pensions are changing for inheritance tax

From April 2027, unused pension funds will form part of your estate for inheritance tax.

That changes how pensions are typically used. They’ve often been left untouched and passed on, with other assets used first – but that approach won’t work in the same way going forward.

What this all means

More of the tax outcome is set by decisions made during the year. Once income has been taken or assets sold, there’s usually limited scope to revisit it.

Which is why conversations in April or May – before those decisions are locked in – tend to be more effective than trying to deal with everything at the end.

The tax traps to be aware of

Some of the biggest tax surprises don’t come from missing allowances. They come from points where the rules change.

The 60% tax trap

Once your income moves above £100,000, your personal allowance starts to taper away.

For every £2 you earn over that level, £1 of your personal allowance is reduced – which pushes the effective tax rate on that band to around 60%. That’s why a relatively small increase in earnings can result in a much larger tax bill than expected.

This is often managed through pension contributions, which reduce your adjusted net income. Bringing that figure back below £100,000 restores the allowance.

At this level, putting £10,000 into a pension could cost you as little as £4,000 after tax relief has been returned from HMRC.

If it’s only reviewed in March, you’re calculating the contribution at the last minute, with limited time to adjust if the numbers aren’t quite right.

Looking at it in April or May, based on expected income for the year, means you can start the contribution early and adjust it if needed – rather than calculating it at the last minute.

The seven-year rule for gifting

If you give money away above £3,000, it usually still counts as part of your estate for 7 years. After 7 years, it normally falls outside your estate for inheritance tax. So timing matters.

Give it away earlier, and that 7-year clock starts sooner. Leave it, and everything gets pushed back.

The pension allowance trap

If you take taxable money out of a pension, your annual allowance drops from £60,000 to £10,000. This is the Money Purchase Annual Allowance.

That £10,000 is the limit from then on. You can’t go above it, and you can’t use unused allowances from previous years.

It mainly affects people still working and contributing while also drawing from a pension. A quick check at the start of the year can avoid a costly mistake.

A more effective way to approach the year

Avoiding the March rush doesn’t mean thinking about tax all the time. It usually comes down to spreading things out:

• April – June: understand what’s likely to matter
• During the year: act alongside income and changes
• January – March: finish things off

Porta’s Take

The rush in March is predictable. Deadlines create urgency, and it’s natural for things to build towards that point.

But the more effective decisions don’t usually sit in that final window. They come from having enough time to think things through and make adjustments along the way.

At Porta, our aim is simple – bring just enough of that thinking forward so that March becomes a final check, not a scramble.

If you’d like to talk about how you can get ahead this tax year, then get in touch.

Important information

This article provides general information only and does not constitute personal financial advice. The information is based on our understanding of current regulations, which may change in future. Decisions about your finances should always be made based on your individual circumstances. If you’re unsure about the suitability of any course of action, you should seek regulated financial advice.

The Financial Conduct Authority does not regulate tax planning, estate planning, trusts or wills.

The value of your investments can go down as well as up, so you could get back less than you invested.

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