How the 2025/2026 New Tax Year Impacts Your Retirement Plans

A new tax year is the perfect time to take stock of your retirement plans.

It’s an opportunity to set new goals, maximise tax allowances, and ensure your plans align with the future you see for yourself.

In this blog, we’ll walk you through the key tax changes, look at tax-efficient ways to save – including how to make the most of your pension contributions – and share our expert tips to get your money working harder for you.

Key Tax Changes for 2025/26

The recent Spring Statement introduced a lot of changes across different areas – but pensions and retirement planning weren’t one of them.

That said, there were some important tax updates that could still impact your day-to-day savings and your long-term plans.

We know that making sense of tax changes can be challenging – it’s like trying to build an IKEA wardrobe without the instructions!

So, here’s a short summary of the key changes and what they could mean for you.

Capital Gains Tax: What’s Changing?

If you’re thinking about selling assets such as a business, property or planning for an inheritance, it’s worth being aware of these updates:

• Lower Tax-Free Allowance – The annual exemption was reduced to £3,000 for individuals and £1,500 for most trusts in the 2024/2025 tax year. This means more of your gains could be subject to tax.
• Capital Gains Tax (CGT) Rate Increase – The tax rate for Business Asset Disposal Relief (BADR) will rise from 10% to 14% from April 2025, then to 18% in April 2026.

It’s always wise to review your plans with a Financial Adviser to make sure you’re taking advantage of all available tax reliefs.

For more insights on deferring your State Pension and potential tax savings, take a look at our blog Should You Delay Your State Pension to Save on Tax?.

National Insurance Changes: What You Need to Know

From 6 April 2025, adjustments to National Insurance Contributions (NICs) could impact you if you’re an employee or employer.

National Insurance Change	Details
Employer NICs Increase	The rate rises from 13.8% to 15%, potentially leading businesses to reassess wages or prices.
Lower Secondary Threshold	The threshold where employers start paying NICs will drop from £9,100 to £5,000. Part-time workers earning below this may see changes in contributions.
Employment Allowance Boost	The allowance that helps employers reduce NICs will increase from £5,000 to £10,500, with more businesses now qualifying.

Tax-Efficient Ways to Save in 2025/26

Despite these changes, there are still plenty of ways to save tax-efficiently. Here’s our top three tips:

1. Maximise Your Pension Contributions
   You can now contribute up to £60,000 a year into your pension and still get tax relief – this is what’s known as your Annual Allowance. Even better, the Lifetime Allowance, which used to set a limit on the total amount you could save in your pension before facing extra tax charges, has been scrapped. That means you can now build up your retirement fund without worrying about hitting a cap.
2. Use Your ISA Allowance
   With tax-free growth and withdrawals, ISAs remain a great savings option. The Annual Allowance (which is the maximum amount you can contribute across all your ISAs within a tax year, remains at £20,000).
3. Plan for Capital Gains Tax Reductions
   With the exempt amount reduced to £3,000 for individuals and £1,500 for most trusts in the 2024/2025 tax year, planning when and how you sell assets, such as shares, investment properties, or business assets, could help minimise tax liabilities.

For more on the impact of pension and tax changes, see our blog What You Should Do About Pension and Tax Changes.

Retirement Planning for More of What Matters (and Less Tax!)

At Joslin Rhodes, we believe retirement should be about more than just money – it’s about making sure your finances support the lifestyle you want.

That’s why we follow our unique PlanHappy Lifestyle Financial Planning approach to help you:

• Map Out Your Financial Future – Using Cash Flow Modelling, we’ll show you how your income, expenses, and savings fit together.
• Consider Early Retirement – Wondering if you could retire sooner? We’ll check if it’s possible based on your current savings and lifestyle goals.

Get our Free Guide to 2025/2026 Tax Allowances

Understanding tax changes can be complex, so we’ve put together a handy Guide to 2025/2026 Tax Allowances to help you stay ahead.
Inside, you’ll find:

• Personal Allowances – What you can earn tax-free
• Income Tax Bands – How your earnings will be taxed
• Savings & Investments – Tax-free options and savings tips
• State Pension – What’s changing for you
• Inheritance Tax – How to protect your estate

Download your copy here.

We’re here to help.

Wherever you are on your financial journey, our expert Teesside team is just a call away. So, if you’re planning for retirement, looking to make your savings work harder, or just want to check you’re on the right track, get in touch.

Because when you start the tax year right, the rest of the year falls into place.