Set the clock for year-end planning

There will be no Budget in spring 2022, leaving the path clear for your year-end tax planning.

The two Budgets of 2021 delivered a substantial amount of deferred tax increases, from higher corporation tax through to extra National Insurance contributions (NICs) and dividend tax. Fortunately, the October Budget did not add any more significant tax rises. Tax levels are set to rise to their “highest sustained level in peacetime” according to the Institute of Fiscal Studies. That might explain why the Chancellor included in his speech the statement that “By the end of this Parliament, I want taxes to be going down not up”.


Your starting point should be to check whether you have any unused pension annual allowance (£40,000 before tapering during the years considered here) from 2018/19. You have until the end of the current tax year to mop up this past allowance or lose it completely.  However, it can only be used once your 2021/22 annual allowance is exhausted.

Unused relief can also be picked up from the years after 2018/19, again once the current year’s allowance is covered. The calculations involved can be complex, so please contact us as soon as possible if you want to take advantage of this carry forward option. 

Capital gains tax

In May 2021 the Office of Tax Simplification (OTS) published the second part of a review of capital gains tax (CGT), originally requested by Mr Sunak. Some radical proposals could have significantly increased the tax payable by many investors. At the end of November, however, the Treasury formally rejected any major CGT redesign, simplifying potentially complex year end CGT planning.If you have capital gains in your portfolio, you should consider realising them up to your available annual exempt amount before the end of the tax year. You could reinvest the proceeds in an ISA or a pension.

Inheritance tax

Inheritance tax was also subject to an OTS review, undertaken before the CGT review. The absence of any mention of the IHT reports in the last three Budgets has, like the CGT review, complicated year-end planning. Again, the Treasury has now removed that uncertainty, confirming that it accepted only one (administrative) proposal and rejected all others. Now is a good time to consider using the three main yearly IHT exemptions (£3,000 annual, £250 small gifts and ‘normal expenditure out of income’).


The value in tax-free ISAs is growing due to the frozen personal allowance and higher rate threshold, dividend tax increases and rising inflation. There is no carry forward of your ISA allowance, so make sure you review your 2021/22 ISA contributions before 6 April.


The value of tax reliefs depends on your individual circumstances. The Financial Conduct Authority does not regulate tax advice and tax laws can change.

The value of your investment and any income from it can go down as well as up and you may not get back the full amount you invested.

Past performance is not a reliable indicator of future performance. Investing in shares should be regarded as a long-term investment and should fit with your overall attitude to risk and financial circumstances.

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