3 Ways To Make The Most Of The New Tax Year

In the UK, the 6th of April 2026 marked the beginning of a new tax year. This is a critical time of year for savers and investors, as this is when new rules take effect, and allowances for savings and investments reset.

In this article, we will be covering three ways to make the most of the tax year 26/27.

Sheffield Mutual are not tax experts. Any information provided is based on our current understanding of tax rules. If you need specific advice regarding taxes, you may need to consult a tax expert, which could incur a fee.

Making The Most Of The New Tax Year

The new tax year is an essential time for savers, as it allows them an opportunity to consider their savings strategy and how best to use their allowances that have been refreshed.

ISA Allowances

The ISA allowance for most adults will not be changing this year, which means that for the tax year 26/27, savers are free to save up to £20,000 in either a cash ISA or a stocks and shares ISA.

However, an important change will be coming at the end of this tax year that will affect any savers under the age of 65.

From April 2027, the amount of money that can be saved in a cash ISA will be limited to £12,000 for any savers under the age of 65. Although this change will not take effect this year, it is important to be aware of this information, in case your future savings strategy involves relying on cash ISAs.

JISAs, or Junior ISAs, also have their allowance reset at the new tax year. If you have a child and are thinking of building a nest egg for their future, JISAs allow adults to contribute up to £9,000 a year without incurring any tax liability. Although a JISA has to be opened by someone with parental responsibility (meaning the parent or legal guardian of the child), any adult can contribute to a JISA, which makes it a great choice for saving Christmas money, birthday gifts and any other funds that family or friends might want to contribute to your child’s savings.

If you don’t already have an ISA, you can make the most of your annual ISA allowance by opening an ISA with a bank or financial institution like Sheffield Mutual. Our range of ISAs includes ISAs designed for regular contributions, as well as ISAs designed for investing lump sums. In addition, we also provide Sustainable ISAs, which have been designed to hold strong Environmental, Social and Governance (ESG) characteristics. Sheffield Mutual’s Sustainable Fund has been designed to provide our members with access to a diverse investment strategy that aligns with net-zero goals and the Principles for Responsible Investment (PRI).

At Sheffield Mutual we are proud that the underlying fund has received recognition of its investment strategy by being awarded with a Sustainability Mixed Goals™ label from the FCA.

The mixed goals label means that the fund aims to invest mainly in a mix of assets that focuses on sustainability and aims to improve their sustainability over time. It also recognises our commitment to investing in assets that support and actively contribute to the ongoing improvement of a better society and healthier environment.

Personal Savings Allowance

Your Personal Savings Allowance is the amount of money that you can earn each year without being expected to pay tax.

Each tax year, your Personal Savings Allowance is refreshed. Your Personal Savings Allowance is determined by your tax rate, and for the tax year 26/67, personal savings allowances are:

• Basic Rate Taxpayer: £1,000
• Higher Rate Taxpayer: £500
• Additional Rate Taxpayer: No personal savings allowance

These rates are the same for the new tax year as they were previously, so for most savers, there may not be any changes in the amount of tax that needs to be paid. However, if you have recently become a higher-rate or additional-rate taxpayer, or your cash savings have increased significantly, then you may need to pay more tax in the coming tax year.

Make The Most Of The New Tax Year With Sheffield Mutual

At Sheffield Mutual, we provide a range of financial products that can help our members save for the future. Whether you are saving for a one-off nest egg or as part of your long-term financial planning, our products help our members to reach their financial goals.

If you aren’t sure which products are right for you, consider trying our product selector and see if you can discover a new way of saving that suits your needs.

If you have any questions about our products, feel free to contact us, and a member of our team will be happy to help with your enquiry.

This article provides generic information and the writer's opinions and should not be relied upon for investment decisions. Sheffield Mutual has provided no advice. If you doubt whether a savings or investment plan suits you, consider contacting a financial adviser for advice. If you do not have a financial adviser, you can get details of local financial advisers by visiting www.unbiased.co.uk or www.vouchedfor.co.uk. Advisers may charge for providing such advice and should confirm any costs beforehand.