How can I use my tax-free allowances before 5 April?

How can I use my tax-free allowances before 5 April?

The end of the tax year is fast approaching, meaning you need to use your tax-free allowances before 5 April.

It is important consider your pension contributions, salary sacrifices and Capital Gains Tax allowances for you to receive the right benefits for you.

There are range of tax-free allowances you should consider using before the end of the tax year on 5 April and this is detailed below.

Personal allowance and dividends

The first £12,570 of your income is covered by your personal allowance and is received tax-free unless your total income exceeds £100,000.

An additional £1,000 of dividend income is covered by dividend allowance (if not already covered by the personal allowance).

This means there is no tax to pay.

If you are a basic rate or higher rate taxpayer, you can also benefit from the personal savings allowance.

This means the first £1,000/£500 (respectively) of interest is free from tax.

Capital Gains Tax

It is important to consider and use the Capital Gains Tax (CGT) annual exempt amount.

This will mean you could receive up to £6,000 of capital gains completely tax-free.

You could potentially use this to further re-invest the gains.

You do need to know that, from April 2024, the amount will reduce to £3,000 per annum and, if you do not already do tax returns, you will need to if your gains exceed £3,000 in future years.


Using an ISA would mean you automatically get zero interest on up to £20,000 worth of interest.

These are a great way of making investments as they allow you to make full use of the annual limits for contributions to your ISAs.

Any growth, income, and gains within these are again completely tax-free.

The annual maximum amount for an adult, that can be saved in ISAs, is £20,000 in a combination of ways through stocks, shares, innovative finance, or cash.

If you have children, they can have a junior ISA with a maximum of £9,000, up to the age of 18.


There is sometimes confusion surrounding the rules of pensions but, when properly understood, they can be another way to reduce your tax liability.

You can use up your personal allowance for pension contributions – the amount you put in which largely depend on the amount of your income for the year, what the income is, and what unused allowances you have from the three prior tax years.

At a minimum, you can make pension contributions of up to £3,600 (gross) in the year and an annual allowance of up to £60,000.

Contributions to your personal pension will also reduce your adjusted net income thus there might be benefits if your income is between £100,000 and £125,140.

This applies where the personal allowance is reduced or for those with income between £50,000 and £60,000 who are subject to the High Income Child Benefit Charge (HICBC).

Always remember to take care with your pension contributions so as not to exceed the annual allowance.

It is crucial to maximise your tax allowances whilst they are still around.

If you would like to make the most of your tax-free allowances before 5 April, please get in touch with the team at Iceberg Accounting.