See how to maximise your allowances from your savings to your pension pot and get your head around some key tax terms.
Remember that tax rules can change, and any benefits will depend on your circumstances.
In the current tax year, you can save up to £20,000 in a tax-efficient Individual Savings Account (ISA).
From 6 April, if you’re aged 18 or over, you can now subscribe to more than one of the same type of ISA in the same tax year – as long as you stay within the overall annual ISA subscription limit.
This doesn’t apply to Lifetime ISAs where you can only subscribe to one Lifetime ISA in a tax year and there is an annual payment limit of £4000.
Please note – HSBC doesn't offer Lifetime ISAs.
This means, for example, you can now subscribe to a cash ISA with HSBC and another cash ISA with a different ISA provider all in the same tax year.
ISA providers aren't obliged to accept subscriptions to more than one ISA of the same type in the same tax year. HSBC is unable to offer this from 6 April 2024.
If you already have an HSBC ISA but didn’t make payments in the previous tax year, you may need to reactivate it before you can pay in any more money.
Find out how to:
You can check to see if you're still eligible for a Global Investment Centre stocks & shares ISA.
An InvestDirect stocks & shares ISA requires a new application each tax year.
Depending on the type of ISA you have, it may take a few working days to reactivate it, so please allow plenty of time.
If you hold a Junior ISA or a Child Trust Fund for a child, you can save up to £9,000 in the current tax year without being liable to pay any UK income tax or capital gains tax on any income or gains arising.
Most people can add up to £60,000 to their pension pot each year, tax-free – or up to 100% of their earnings if they earn under £60,000 a year. This means the total sum of any personal contributions, employer contributions, and tax relief can’t usually exceed the £60,000 pension annual allowance.
If you haven’t reached this limit, you may want to consider adding more to your pension from your pre-tax income. However, you might not be able to access this money until you’re at least 55 years old (or 57 from 2028). Find out more from MoneyHelper about tax relief on pension contributions.
You might also be interested in how much you need to retire and how workplace pensions work.
The capital gains tax (CGT) allowance has been reduced to £3,000 for the 2024/2025 tax year (down from £6,000).
In the current tax year, you can sell investments, property, and other assets without having to pay any tax on the first £3,000 worth of gains.
You can’t carry over any unused CGT allowance to the next tax year. If you want to sell assets that would make you more than £3,000 in profit, it might be worth staggering the sale over 2 tax years.
There has been an increase in CGT rates paid on any profits made from investments. These apply to the sale of assets such as second homes or shares.
From 30 October 2024, the rate for investment went up from 10% to 18% for non and basic rate income taxpayers and from 20% to 24% for higher and additional rate income taxpayers.
This brings them into line with the rates on residential property.
For the 2024/2025 tax year, there will be a split year for CGT rates for investments. Any gains before 30 October 2024 will be taxed at 10% or 20% and gains made on or after that date will be taxed at 18 or 24%.
A tax code lets your employer or pension provider know how much income tax you need to pay. Check your tax code is correct online or by calling HM Revenue & Customs (HMRC)).
If your employer or pension provider doesn’t have a tax code from HMRC, it has to apply an emergency tax code. If this happens, you might have more tax deducted from your earnings or pension than necessary.
But don’t worry, emergency tax codes are temporary. Your employer or pension provider should receive a tax code from HMRC quickly.
Tax credits are extra funds given by the government. There are two types:
Find out if you should be receiving tax credits by contacting HMRC.
National Insurance is a tax on earnings and self-employed profits.
If you earn more than £242 a week from your employer and you're over 16 years old, you’ll need to pay National Insurance contributions (NICs).
The National Insurance rate for employees in the 2024/2025 tax year is 8% on earnings between £12,570 and £50,270 and 2% on earnings above £50,270.
The Class 4 rate for the self-employed in the 2024/2025 tax year is 6% on profits between £12,570 and £50,270 and 2% on profits above £50,270. The self-employed no longer have to pay Class 2 contributions.
The Chancellor Rachel Reeves announced in her 2024 Autumn Budget that National Insurance thresholds for employees would remain frozen until 2028/2029.
However, from 6 April 2025, the NICs rate for employers will increase by 1.2 percentage points from 13.8% to 15%. The annual threshold at which employers start to pay NICs will also go down from £9,100 to £5,000.
If you need a certificate of interest (tax certificate) to complete your tax self-assessment, please send us a secure e-message in online banking or by using chat in the mobile banking app.
The certification of interest confirms the total amount of credit interest paid into an account over the tax year.
Once we receive your request, we’ll post this to you within 7 working days.
This article was last updated: 06/11/2024, 08:34
