Five UK Tax Allowances You Might Be Missing (And How to Claim Them)

Five UK Tax Allowances You Might Be Missing (And How to Claim Them)

Paying tax is a reality for most of us in the UK, but many taxpayers overlook UK tax allowances and reliefs that could save them money.

By understanding and claiming the available tax allowances, you can reduce your tax bill and maximise your savings.

Here are five key UK tax allowances that people commonly miss, along with guidance on how to claim them.

1. Personal Allowance

The Personal Allowance is the amount of income you can earn each tax year before you start paying income tax. For the 2025/26 tax year, the standard personal allowance is £12,570.

• If your income is below this threshold, you won’t pay income tax.
• High earners (income above £100,000) see their allowance gradually reduced.
• Make sure your tax code with HMRC reflects your situation to avoid overpaying.

Reference: HM Revenue & Customs- Income Tax rates and allowances

2. Marriage Allowance

The Marriage Allowance allows eligible couples to transfer a portion of their personal allowance from one spouse or civil partner to the other. These UK tax allowances can reduce the recipient’s tax by up to £252 for the 2025/26 tax year.

• Applies if one partner earns less than the personal allowance and the other is a basic rate taxpayer.
• Can be claimed online via the HMRC website.
• It can also be backdated up to four tax years if previously unclaimed.

Read about are you claiming the Marriage Allowance 

3. Blind Person’s Allowance

If you are registered as blind or severely sight-impaired, you may be eligible for the Blind Person’s Allowance, which is an additional amount added to your personal allowance.

• For 2025/26, this allowance is £2,870.
• If your income is high enough to pay tax, this allowance reduces the amount of tax you pay.
• You can claim online, by post, or through your tax return.

4. Dividend Allowance

The Dividend Allowance allows you to receive a certain amount of dividend income tax-free each year. For 2025/26, this allowance is £1,000.

• Applies to dividends received from UK companies and certain foreign companies.
• Dividends above this threshold are taxed at rates depending on your income tax band.
• Claiming the allowance is automatic if you file a self-assessment tax return.

5. Capital Gains Tax Annual Exemption

The Capital Gains Tax (CGT) Annual Exemption allows you to realise gains up to a certain limit without paying CGT. For 2025/26, the exemption is £3,000.

• Applies to the sale of assets such as shares or property (excluding your main home).
• Exceeding this limit may trigger CGT at rates depending on your income tax band and the type of asset.
• Use careful planning to spread disposals across tax years and make the most of this allowance.

💡 Final Thoughts

UK tax rules provide a variety of allowances designed to reduce your tax burden legally.

Many people miss out simply because they are unaware of their eligibility.

By keeping up to date with the latest UK tax allowances and claiming them correctly, you can save hundreds, or even thousands, of pounds each year.

For personalised guidance, it’s always advisable to speak to a regulated financial adviser or tax professional who can review your situation and ensure you maximise your tax reliefs.

This blog provides general information and does not constitute personalised financial advice. Speak to a regulated financial advisor about your specific circumstances