12 days of personal tax tips this Christmas

Last year, some 40,000 people filed their tax return over the Christmas break, according to HMRC, with nearly 4,500 of those actually clicking “submit” on 25 December.

It might not sound terribly festive, but “Twixmas” (that quiet week between Christmas and new year) can provide a great opportunity to get all sorts of financial admin done and prepare for the year ahead.

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So, if you’ve had your fill of board games and Christmas films – but don’t quite have the energy to brave a run – here are some jobs you can get done from the comfort of your sofa.

Tick a few off the list and the rewards might make you feel like next Christmas has come early.

1) File your tax return

There’s no denying this one feels like a chore, but you’ll feel a whole lot more relaxed going into 2026 knowing it’s done.

The deadline for self-assessment is 31 January. Starting now gives you the time to gather your paperwork, plus, if you need to talk to someone at HMRC, the helpline queues are likely to be shorter. You’ll also have time to correct any errors and plan how to pay your bill, without the risk of penalties.

If you’re a higher or additional rate taxpayer and contribute to a personal pension such as a SIPP, be sure to properly declare your contributions to get the full rate of relief you’re due.

2) Top up your SIPP

There’s nothing like a tax return to focus your mind on your personal pension. Seeing the total you’ve paid in over the year can give you a timely nudge to pay in a bit more and provide an instant reminder of the tax benefits of pension contributions.

If you’ve got a self-invested personal pension (SIPP), or any other personal pension that you arranged yourself, you’ll get 20% tax relief applied automatically – boosting every £1,000 you pay in by £250. But higher and additional rate taxpayers can claim a further 20% or 25% back through their tax return the following year.

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3) Use carry-forward

You can contribute 100% of your earnings up to £60,000 into your pension each year. But, if you’ve had a particularly profitable year, you might be able to pay in more by taking advantage of carry-forward rules. These let you pay any unused allowance from the previous three years (subject to certain rules).

4) Milk salary sacrifice – while you still can

Salary sacrifice is the most tax-effective way to pay into a pension: you get the full rate of tax relief automatically and you make national insurance (NI) savings as well. But while the chancellor announced that salary sacrifice will be capped at £2,000 a year in the recent Budget, those changes don’t come into force until April 2029.

So, if you use salary sacrifice to pay into a workplace pension, continue to take advantage of it while you still can. One particularly savvy move, if you’re expecting a bonus in 2026, is to ask your employer to pay it straight into your pension, provided you’re happy to forgo access to the cash until age 55 (rising 57 from 2028). That way you’ll get the full value of your bonus, without losing any to tax or NI.

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5) Pay into someone else’s pension

Sticking with the pension theme, you can also pay into someone else’s pot. Even if they don’t pay tax, they can still get basic rate tax relief on contributions up to £2,880 a year (which will be worth £3,600 once tax relief is applied). That could be a partner that’s taken time out of work to raise a family or even to give a child a head-start with their retirement saving.

6) Use your ISA allowance every year

The annual allowance for capital gains now stands at just £3,000 a year (down from £12,300 in 2023), making it more important than ever for investors to use stocks & shares individual savings accounts (ISAs) to shelter their profits from tax.

Using an ISA will shield you from dividend tax too, with that allowance standing at just £500 a year now.

You can invest £20,000 in ISAs each year, but the cash limit will reduce to £12,000 for under 65s from April 2027.

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7) Bed & ISA

It’s straightforward investing cash into a stocks & shares ISA, but you may also be able to move holdings in general investment or trading accounts into the tax-free wrapper as well, if they’re all on the same platform.

This involves selling your investments and immediately rebuying them in your ISA, shielding them from tax going forward. You just need to be careful not to transfer so much that you trigger a capital gain. If you’ve got gains worth more than £3,000 you can do it once before the end of the tax year and again at the start of the new tax year on 6 April.

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8) Use your CGT annual allowance – every year

The problem with the annual exemption for capital gains tax (CGT) is that most people only use it in the year that they sell their investments. That means if you’ve got even modest investments outside an ISA or pension that you’ve held for years, you could be brewing a big bill. However, there are still ways to use your allowance each year without selling up and exiting the market altogether.

A Bed & ISA is one option but, if you don’t have enough allowance remaining, you can still sell gains up to the CGT allowance and reinvest the money elsewhere. This could be an equivalent holding, or you could use it as an opportunity to rebalance your portfolio and restore your original asset allocation.

Your future gains won’t be sheltered from tax as they would in an ISA, but the size of that gain will be reduced.

9) Save for the children in your life

If you want to help your children (or grandchildren) save for the future and shelter your money from tax, don’t forget that they will have their own ISA allowance too.

Each year children can save up to £9,000 in a Junior ISA and you can contribute on their behalf – just be mindful that once they turn 18 they will have full access to their money.

10) Use your annual gift allowance

If you’re worried about IHT, there are various gifting allowances, which can take money out of your estate immediately.

A good starting point is the annual gift allowance – each year you can give away £3,000 either to one person or divided between a few. In fact, if you didn’t use your allowance last year, you can use that too and give a maximum of £6,000 away tax-free this year.

• The interplay between CGT and IHT when gifting wealth to children
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Also, if you’ve got any weddings lined up in the year to come, there are additional gifting allowances. You can give £5,000 to your children tax-free when they tie the knot, £2,500 to grandchildren (and great-grandchildren) plus £1,000 to anyone else.

11) Plan some regular gifts

You can also give away as much you like from your surplus income to reduce your IHT bill. So long as the gifts are regular in nature, come from income and don’t impact your lifestyle, there will be no IHT to pay.

The catch is that you need to keep records of your income and expenditure to ensure your executor can prove the gifts meet required criteria. Form IHT403 gives you an idea of the detail HMRC will need.

If you aren’t sure where to start, talk to family about what they would appreciate. Squeezed adult children might appreciate contributions to their pensions (which works out incredibly tax effective) or their children’s Junior ISAs (JISAs).

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Alternatively, they might welcome support with any other troublesome family costs – whether that’s money for kids’ music lessons, tutors in the run up to big exams or simple help with the mortgage.

This option isn’t widely used but, if you don’t mind the admin, it can be an excellent way of getting money out of your estate and helping your family.

12) Work as a team

If you’re married (or in a civil partnership) remember there’s a lot of tax to be saved by working together. You can effectively double all your allowances – sheltering a combined £40,000 in tax with ISAs, for example, or giving away £6,000 in tax free gifts to loved ones between you to save on IHT (£12,000 if you didn’t use last year’s allowances).

Plan carefully and you may be able to take advantage of both sets of allowances. By transferring savings or investments into your partner’s name for example, you might be able to avoid a tax charge altogether, or, if that’s not an option, pay tax at a lower rate.

It can be a bit complicated though, so if you aren’t sure what to do, it’s worth talking to a financial planner.