What is a tax year?
A tax year is a 12-month period which starts on 6 April and ends on 5 April the following year. We are currently in the 2024–25 tax year.
Each year, you can save a certain amount of money in your ISA, pension and child’s Junior ISA tax-free. These are known as your ‘allowances’. The amount varies depending on the type of account and, in the case of pensions, how much you earn.
Make the most of your allowances
Using your allowances before the tax year ends makes sound financial sense.
Your ISA, Junior ISA and pension savings can grow free from Income and Capital Gains Tax (CGT).
Stocks and Shares ISA | Personal Pension | Junior ISA | General Account | |
|---|---|---|---|---|
Annual allowance | £20,000 | £60,000* or your income, whichever is lower | £9,000 | Unlimited |
Tax relief on contributions** | ||||
Tax-free withdrawals | 25% – the other 75% is taxable income | Tax-free, when the child is 18 | ||
Carry forward allowance | Previous 3 years |
*Your allowance could be higher if you can use carry forward. It could be lower if you are a higher earner. It will be lower if you are a non-earner or have withdrawn from your pension. Find out how much you can pay into a pension.
**If you are making contributions through your Ltd company, you get a reduction in Corporation Tax, not tax relief. Find out more about our Personal Pension.
Why it's smarter to invest than save
Long-term returns
Over time, shares typically deliver higher returns than saving cash.
Compound growth
The longer you invest, the more you benefit from compounding. Even small amounts can grow over time.
Tax year end checklist
At Vanguard, we aim to make investing simple.
Our team of experts have created a checklist to help you get tax year end ready.
Check how much allowance you have left to use.
Check how much cash you’re holding. You could invest it to use up your allowance.
Carry forward any unused pension allowance from previous 3 years, if you can.
Use your child’s Junior ISA allowance if you’re saving for children.
Use your Capital Gains Tax allowance if you have a General Account.
Think about a Bed and ISA or a Bed and SIPP.
How to guides
Check your allowance
Find out how to view what ISA and Junior ISA allowance you have left for this tax year.
How do I add cash?
Find out how to add money to your Vanguard account by debit card.
Move money from a General Account to an ISA
Also known as a 'Bed and ISA'.
"The government provides generous tax allowances through ISAs and pensions to help you save for your future. Using these wrappers means you won’t pay Income Tax on dividend or interest income, or Capital Gains Tax on growth, increasing your chances of achieving investment success."
Head of Retirement and Managed Services
Insights from our experts
Four reasons to top up your ISA by 5 April
With only two months to go until the end of the tax year, discover why topping up your ISA by 5 April could help to supercharge your long-term returns.
5 reasons to pay into your pension before tax year-end
From improving your retirement prospects to lowering your income tax bill, we explore five reasons to top up your pension before tax year-end on 5 April.
What is ‘bed and ISA’ and ‘bed and pension’?
‘Bed and ISA’ or ‘bed and pension’ means moving investments from a general account to an ISA or pension. We discuss how it works and whether it’s worth doing.
How to reduce your Capital Gains Tax bill
More people are getting caught out by Capital Gains Tax (CGT). So how do you protect yourself? Vanguard’s chief financial planner in the UK, James Norton, offers investors some tips.