How to Pay Less Tax Legally in the UK

1. Use your tax-free allowances

• ISAs: up to £20,000 a year of tax-free savings. See what an ISA is.
• Personal Savings Allowance: £1,000 of interest tax-free for basic rate taxpayers.
• Dividend allowance and Capital Gains Tax exempt amount if you invest outside an ISA.

2. Pay into a pension

Pension contributions get tax relief and can lower the tax on part of your income. Use salary sacrifice if your employer offers it, and compare it with the salary sacrifice calculator.

3. Claim what you are entitled to

• Marriage Allowance, worth up to £252 a year for eligible couples.
• Gift Aid relief if you are a higher rate taxpayer giving to charity.
• Work expenses for some jobs, such as uniforms or professional subscriptions.

4. Check your tax code

A wrong tax code costs money. Check yours with the tax code checker.

5. Watch the tax traps

Income between £100,000 and £125,140 is effectively taxed at 60%. See the 60% tax trap. The Child Benefit charge starts at £60,000.

Tax avoidance schemes that promise to cut your bill dramatically can end badly. Stick to official allowances, and take professional advice for complicated situations.

This guide is general information, not financial or legal advice. Rates checked 8 October 2026 against GOV.UK.