Tax-efficient planning strategies

Good tax planning starts from a clear-eyed view of what each wrapper or technique actually shelters — the most common planning errors come from assuming a tool that's efficient for one tax is efficient for all of them. ISAs shelter income and gains from Income Tax and Capital Gains Tax completely, but have no effect on Inheritance Tax at all — the full value stays in the estate. Pensions are the mirror image in one respect: normally outside the estate for IHT, alongside their own income tax reliefs on contributions. Transfers between spouses or civil partners are free of Capital Gains Tax (no gain, no loss), which is why equalising ownership before a disposal is a standard technique — it lets a couple use two annual exempt amounts and two sets of rate bands instead of one. The CGT annual exempt amount itself renews every tax year and cannot be carried forward, so splitting a large disposal across the end of one tax year and the start of the next can use two years' worth of allowance. And where an investor wants to move a holding into a wrapper without genuinely stepping out of the market, "bed and ISA" (or "bed and SIPP") specifically escapes the same-day/30-day share matching rules that would otherwise cancel out a same-day repurchase in an ordinary account.