This is an ideal time to remind our clients of the tax efficient allowances that are available to them and their family.

Individual Savings Accounts (ISA)
The current limit remains at £20,000 per tax year into one or multiple accounts. Any growth achieved will not be subject to income or capital gains tax and for many this remains an integral part of a tax efficient investment strategy.

Do you have a flexible Stocks and Shares ISA that allows withdrawals to be paid back in within the same financial year? If not discuss this with your Advisor.

As announced in the last budget, from April 2027, the amount that can be placed into a Cash ISA for the under 65’s will be reduced to £12,000, which may trigger a change to the way that you use your allowance.

Junior ISA (JISA)
This is an account that can be opened for children under the age of 16 with an annual limit of £9,000. Neither income or capital gains tax are charged on any growth achieved and can be used as a foundation for university fees, first property purchase etc.

Lifetime ISA (LISA)
This account is designed to assist anyone who is looking to plan for their first property purchase and/or retirement and can be opened between the ages of 18 and 39. The maximum subscription each tax year is £4,000 which then receives a bonus of 25% from the Government, turning a £4,000 investment into £5,000 each year, before any potential investment growth.

A new first time buyer ISA is anticipated in April 2028, and we will share details once full information has been received.

Pensions
If you are employed it is likely that you are a member of your Workplace Pension scheme. We would certainly encourage remaining within or joining your Company scheme as your employer will also contribute at least 3% of your salary, in essence “free money”.

Changes to company pension contributions made through salary sacrifice are planned for April 2029, your Advisor will be able to discuss the possible impact to you nearer the time.

If you do not have access to a company funded scheme or have surplus capital or income available after contributing to your workplace scheme, pension contributions still represent an extremely tax efficient method of investing towards your future

If you own your own business, you may be able to fund your pension through your company, extracting profits tax efficiently by reducing the amount of corporation tax that you pay.

You can discuss the maximum amount that you could place into a pension and receive tax relief at your highest marginal rate with your Adviser.

The options above often form the basis of a tax efficient investment portfolio. However if all available allowances are being used and appropriate funding of the above tax wrappers has already been made, alternative investments may result in tax being paid.

Talk to your advisor to explore all investments options available and you will be made fully aware of the possible tax implications of any recommended investment solution.

The payment of tax, after using the traditional tax efficient methods referred to above, should be viewed as a positive as it means that you’ve made a return on your invested funds!!

​​Risk Warnings

• The value of an investment and the income from it could go down as well as up.
• All investing is subject to risk, including the possible loss of the money you invest.
• Past performance is not a reliable indicator of future results.
• Diversification does not ensure a profit or protect against a loss.
• Please remember that all investments involve some risk. Be aware that fluctuations in the financial markets and other factors may cause declines in the value of your account. There is no guarantee that any particular asset allocation or mix of funds will meet your investment objectives or provide you with a given level of income
• This communication is for general information only and is not intended to be individual advice. It represents our understanding of law and HM Revenue & Customs practice as at 21st January 2026. You are recommended to seek competent professional advice before taking any action.

A Shift in Global Market Leadership

For the first time in years, the US lagged behind other regions. Even with record‑level investment flowing into the “Magnificent Seven,” some investors grew cautious due to the high valuations and heavy tech-sector concentration within the S&P 500.

Meanwhile, Emerging Markets benefited from:

Strong growth forecasts

A softer US dollar

Investor appetite to diversify away from US concentration risk

Tariffs, Trade Tensions & A New Global Landscape

No review of 2025 would be complete without the events of early April, when the Trump administration announced sweeping new tariffs on “Liberation Day.” Markets reacted swiftly with bouts of volatility as:

• Negotiations stalled and resumed
• A patchwork of new trade agreements emerged
• Companies and consumers braced for shifting supply chains

The result: the US now faces its highest average tariff rate since 1935, with goods such as clothing, electronics, computers, and vehicles among the most affected.

The full long‑term economic impact is still unfolding.

AI: The Defining Mega‑Trend Going Into 2026

Artificial Intelligence continued to dominate headlines and investment flows.

2025 saw billions invested into AI‑focused companies, pushing valuations higher.
However, investors remain watchful about:

• How quickly AI will begin improving corporate profits
• Whether the long-term cost efficiencies will justify the scale of investment

AI remains one of the most influential forces shaping markets in 2026.

Central Banks Shift Their Stance

Across 2025, nine major central banks cut interest rates, including:

• The US Federal Reserve
• The European Central Bank
• The Bank of England

Inflation continued to cool from its peaks, although it remains above target in key economies.

Japan, in contrast, stood out by raising rates twice which provides another reminder of how varied global monetary policy has become.

What About Fixed Income?

Despite a noisy backdrop, Sterling credit markets proved resilient, rewarding investors with attractive yields supported by strong company fundamentals.

Other areas also showed promise:

• Government bonds became more attractive as falling rates boosted valuations
• Global inflation‑linked debt offered potential protection from unexpected inflation at far better prices than in recent years

Looking Ahead to 2026

Sticky Inflation

Inflation remains stubborn and this is especially the case in the US. New tariffs may increasingly feed through to consumer prices as retailers reach the limit of what they can absorb.

A Volatile Start to the Year

2026 began with fresh geopolitical uncertainty following the arrest of Venezuela’s Nicolás Maduro by the US administration. With no clear successor named, questions about the future of Venezuela’s oil production could impact global energy markets.

Expect More Volatility (But Stay Calm)

While markets have seen repeated bouts of turbulence in recent years, volatility itself is not new. Our Investment Committee continues to believe in diversification and remains committed to making allocation changes only when we have strong conviction.

We encourage investors to stay focused on the long term. Attempting to time short-term market swings is rarely effective and keeping a steady, rational approach allowed our portfolios to deliver positive returns over the past 12 months.

​​Risk Warnings

• The value of an investment and the income from it could go down as well as up.
• All investing is subject to risk, including the possible loss of the money you invest.
• Past performance is not a reliable indicator of future results.
• Diversification does not ensure a profit or protect against a loss.
• Please remember that all investments involve some risk. Be aware that fluctuations in the financial markets and other factors may cause declines in the value of your account. There is no guarantee that any particular asset allocation or mix of funds will meet your investment objectives or provide you with a given level of income
• This communication is for general information only and is not intended to be individual advice. It represents our understanding of law and HM Revenue & Customs practice as at 21st January 2026. You are recommended to seek competent professional advice before taking any action.