MAXIMISE YOUR PENSION PLANNING BEFORE THE END OF THE 2025/26 TAX YEAR

As the 2025/26 tax year ends on 5 April, now is the right time to review your pension arrangements and ensure you’re maximising all available allowances. Taking proactive steps in pension planning now can help you secure valuable tax relief, boost your retirement fund and prepare for the future. Acting quickly allows you to fully utilise the rules before the new tax year begins, ensuring you don’t miss out on potential benefits.

Recent economic and political events have emphasised the importance of practical pension contributions and understanding relevant limits. Although the broader tax landscape has seen minor changes, adjustments to thresholds and regulations affecting pension scan significantly influence your long-term retirement plans. With the deadline approaching, it is crucial to make any final top-ups to your pension while you still can.

REVIEWING PENSION ALLOWANCES AND TAX RELIEF

Pension contributions remain one of the most tax-efficient methods to save for retirement. Contributions receive tax relief at your marginal rate, making each pound you invest work harder for your future. As the tax year concludes, review your contributions against your annual allowance to ensure you do not miss out on this valuable relief.

An annual allowance limits how much someone can pay into pension schemes each year before incurring Income Tax. In 2025/26, individuals can contribute up to £60,000 into pension schemes without paying Income Tax. Typically, tax relief is not available for pension contributions above an individual’s earnings. However, individuals can still contribute up to £3,600 annually, including tax relief, even if their earnings are below this amount.

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This article is for information purposes only and does not constitute tax, legal or financial advice. Tax treatment depends on individual circumstances and may change in the future. A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). The value of your investments (and any income from them) can go down as well as up, which would have an impact on the level of pension benefits available. Investments can fall as well as rise in value, and you may get back less than you invest.