Tax-Efficient Planning · Bath

Tax-efficient planning.

ISAs, pensions, the right wrappers in the right order, for clients across Bath, Bristol and the South West. The same money grows or shrinks depending on which envelope it sits in — and most people leave allowances on the table every single year.

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60%
the effective rate of tax on income between £100,000 and £125,140, where the personal allowance is withdrawn. A trap most people don’t know they are in.
2026/27 figures for England, Wales and Northern Ireland. Scottish rates differ.
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Tax planning isn’t about exotic schemes. It’s about using the allowances Parliament has already given you, in the right order, before the year-end quietly takes them away.

i. · What this includes

Six everyday allowances, used properly.

No schemes, no loopholes. The reliefs the rules already give you, taken in the right sequence.

i.

Annual ISA strategy

Using your £20,000 ISA allowance fully and in the right order, so growth and income stay outside the taxman’s reach for good.

ii.

Pension contributions & carry forward

Making the most of pension tax relief within the £60,000 annual allowance, including unused allowance carried forward from the previous three tax years where it helps.

iii.

Capital Gains Tax

Using your £3,000 annual exemption and sequencing disposals, so gains are realised as efficiently as the rules allow.

iv.

Dividend & salary mix

For business owners, the right balance of salary and dividends — and rather more valuable since dividend rates rose by two percentage points in April 2026.

v.

Investment bond gains

Top-slicing relief and timed encashment, so a bond gain isn’t taxed more harshly than it needs to be.

vi.

Salary sacrifice

Reviewing salary sacrifice for pensions and benefits, where it cuts tax and National Insurance for both sides — and planning around the £2,000 cap arriving in April 2029.

ii. · Who this is for

If any of these is you, it’s worth a look.

—Higher and additional-rate taxpayers
—Anyone losing allowances they didn’t know they had
—Business owners weighing salary against dividends
—Clients with unwrapped investments nearing CGT thresholds
—Anyone with an investment bond gain coming up
—People caught in the £100,000 personal-allowance taper
iii. · My approach

Annual work, not a one-off.

Tax planning is annual work, not a one-off. Every January I send clients a tax-year-end checklist — use it or lose it.

The aim is never to chase exotic schemes. It’s to make full use of the allowances Parliament has already given you, in the right sequence.

Done well, this single discipline often outperforms anything else in a financial plan — quietly, every year along the way. It also connects to everything else: the wrapper an investment sits in is part of how it is managed, pension contributions are part of retirement planning, and what is left at the end is part of inheritance tax planning.

— Andrew

Worth knowing before 5 April 2027

This is the last tax year of the full £20,000 cash ISA.

From 6 April 2027, the amount you can put into a cash ISA falls to £12,000 a year for savers under 65, announced at the Autumn Budget in November 2025. The overall £20,000 ISA allowance is unchanged — the balance can still go into a stocks and shares ISA — and savers aged 65 and over are exempt from the reduction. If a large cash ISA subscription is part of your plan, 2026/27 is the year to use it.

iv. · Common questions

Tax, in plain English.

For the 2026/27 tax year, up to £20,000 across all your ISAs, with all growth and income tax-free. It is use it or lose it: the allowance resets on 6 April and unused allowance is not carried forward, though money already inside an ISA stays sheltered indefinitely. One change to plan for — from 6 April 2027 the cash ISA limit falls to £12,000 a year for savers under 65, with the overall £20,000 allowance unchanged and over-65s exempt.
Between £100,000 and £125,140 of adjusted net income, your £12,570 personal allowance is withdrawn by £1 for every £2 you earn, on top of 40% income tax — an effective rate of around 60% on that slice. A pension contribution or salary sacrifice is often the simplest way to step back out of it. These thresholds are frozen until April 2031, so more people drift into the band each year. Figures apply to England, Wales and Northern Ireland; Scottish rates and bands differ.
The annual allowance is £60,000 for 2026/27, or 100% of your relevant UK earnings if lower, and you can carry forward unused allowance from the previous three tax years if you were a scheme member then. High earners are tapered: where threshold income exceeds £200,000 and adjusted income exceeds £260,000, the allowance falls by £1 for every £2 over, down to a floor of £10,000. If you have already flexibly accessed a pension, the money purchase annual allowance of £10,000 applies instead.
The dividend allowance is £500 for 2026/27. Above that, dividends are taxed at 10.75% for basic-rate taxpayers, 35.75% for higher-rate and 39.35% for additional-rate. The basic and higher rates each rose by two percentage points on 6 April 2026, which has made the salary-versus-dividend question meaningfully more valuable for company directors to revisit.
No. There are no exotic schemes here. It’s the everyday allowances and reliefs the rules already give you — ISAs, pensions, CGT exemptions — used properly and in the right order.
Yes, and often I do. The financial plan and the tax return need to agree, so I coordinate with your accountant rather than duplicate their work. I advise on financial planning; your accountant remains responsible for your tax return and tax compliance.
Before the tax year ends on 5 April 2027. Most allowances reset each year and are lost if unused, so the planning is most valuable in the months before the deadline — though pension carry forward, capital gains sequencing and bond encashments are worth reviewing all year round rather than in a March rush.

This page is general educational information about tax-efficient planning. It is not personal financial or tax advice and does not take account of your individual circumstances. Tax thresholds, allowances and rules are subject to change.

Risk warnings. The value of investments and any income from them can fall as well as rise. You may get back less than you invest. The value of any tax relief depends on your individual circumstances. HM Revenue and Customs practice and the law relating to taxation are complex and subject to change.

Figures. All allowances and rates shown are for the 2026/27 tax year and, where income tax is concerned, apply to England, Wales and Northern Ireland. Scottish income tax rates and bands differ. Announced future changes are stated with the date they take effect. Source: HM Revenue & Customs.

Andrew Daw is an Appointed Representative of Saltus Wealth Partnership Limited (FCA FRN 449607), trading as Duchy IFA. For UK residents only.

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Begin with a conversation.

A complimentary 30 minutes, by phone, video or in person in Bath. We’ll look at the allowances you’re using, the ones you’re missing, and what to do before the year-end. No obligation, no pitch.

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