Key takeaways
- A 60/40 split left alone through the 12 months to 31 October 2026 ended at 63.19% equity on FTSE 100 and UK gilt tracker returns, a drift of 3.19 percentage points.
- The same £400,000 of funds costs £1,400 a year across two Hargreaves Lansdown accounts, £1,250 in one account, and £375 under Vanguard's capped fee.
- The £20,000 ISA, £3,000 capital gains and £500 dividend allowances all end on 5 April 2027, and only the £60,000 pension allowance carries forward.
- FSCS covers deposits to £120,000 per bank and investments to £85,000 per firm, so the limit follows the firm rather than the number of accounts.
- Adding a £400,000 unused pension to the £500,000 example estate on GOV.UK moves the Inheritance Tax bill from £70,000 to £230,000 once the 6 April 2027 rules apply.
What an annual portfolio review can actually move
If your money sits in an ISA, a pension, a dealing account and some cash, what are you supposed to check once a year? Four things change measurably over twelve months. Almost everything else is price noise.
Those four are your allocation across every account at once, the allowances that expire on 5 April, what the accounts cost, and who the provider has on file to receive the money. Each one carries a number. A 60/40 split held through the 12 months to 31 October 2026 finished at 63.19% equity. The same £400,000 of funds carries a £1,400 annual charge in two Hargreaves Lansdown accounts and £375 under Vanguard's cap. Adding a £400,000 unused pension to the £500,000 example estate on GOV.UK moves an Inheritance Tax bill from £70,000 to £230,000 from 6 April 2027.
What isn't on the list is a view on markets. None of the four checks needs a forecast, and that's what makes them checkable. You can finish each one with a figure and know whether it came to anything.
Your allocation is a whole portfolio number, not an account number
Here's the awkward part of holding four accounts: each is reported separately and none of them is your portfolio. A stocks and shares ISA holding only trackers reads as 100% equity. A pension holding the bonds reads as defensive. Neither statement describes the mix you're running. Cross account allocation only exists once you add the balances up, which is tedious enough by hand that LedgerTouch does it for you.
Put the mix in one place and a single year does visible work on it. The iShares Core FTSE 100 UCITS ETF returned 13.78% over the 12 months to 31 October 2026. The iShares Core UK Gilts UCITS ETF returned minus 0.57% over the same window. A 60/40 built from those two and left alone finishes at 63.19% equity and 36.81% bonds, a drift of 3.19 percentage points.
That drift is small, and the interesting thing about it is that no single statement shows it. If the equities sat in the ISA and the bonds in the pension, the ISA grew faster, the account holding the equities now carries more of the risk, and the allocation you chose moved without anyone deciding anything.
Calendar 2022 shows the other size of the same effect. The FTSE 100 tracker returned 4.62% that year while the gilt tracker lost 23.83%. The same 60/40 finishes 2022 at 67.32% equity, a drift of 7.32 percentage points, which would have breached a 5 point band. The direction isn't predictable either. In one of those years the equity weight rose because equities gained; in the other it rose because bonds fell. Our piece on portfolio drift follows a single year in more detail.
Four allowances expire on 5 April and only one carries forward
The tax half of a portfolio review checklist is the part of an annual portfolio review with hard deadlines attached. These are the figures GOV.UK publishes for the 2026 to 2027 tax year, which ends on 5 April 2027.
| Allowance | Amount | Carry forward |
|---|---|---|
| ISA subscription | £20,000 | None described |
| Capital gains annual exempt amount | £3,000 | None described |
| Dividend allowance | £500 | None described |
| Personal Savings Allowance | £1,000 basic rate, £500 higher rate, nil additional rate | None described |
| Starting rate for savings | £5,000, tapered by other income above the Personal Allowance | None described |
| Pension annual allowance | £60,000 | Previous 3 tax years |
Only the pension pages describe reaching backwards: "You might be able to carry over any annual allowance you did not use from the previous 3 tax years." Four tax years at the current £60,000 is £240,000 of arithmetic headroom, though relief is separately capped, because "You can get tax relief on private pension contributions worth up to 100% of your annual earnings." A high earner has a second test to run, since the allowance can taper where threshold income exceeds £200,000 and adjusted income exceeds £260,000.
The capital gains allowance is where ignoring the date is easiest to price. GOV.UK's own example takes £12,600 of taxable gains. The £3,000 allowance leaves £9,600, and because the combined figure stays inside the £37,700 basic rate band the tax is £1,728 at 18%. Put the identical gain on a higher rate taxpayer and the rate is 24%, so the bill is £2,304. That's £576 of difference on the same gain, decided by the owner's income rather than the holding.
Dividends changed rate this tax year, and HMRC said so plainly in advance: "The ordinary rate will rise from 8.75% to 10.75%, and the upper rate from 33.75% to 35.75% from April 2026." GOV.UK's table now shows 10.75% for basic rate taxpayers, 35.75% for higher rate and 39.35% for additional rate, applying from 6 April 2026, with the £500 allowance on top. On the £3,000 of dividends in GOV.UK's example, a higher rate taxpayer pays £893.75 and a basic rate taxpayer pays £268.75, a £625 gap on identical shares. Which account holds the income paying assets changes the bill without changing the holding, which is the whole subject of our guide to asset location.
One piece of housekeeping belongs here, because it's the step that loses allowance rather than money. An ISA transfer should take no longer than 15 working days between cash ISAs and 30 calendar days for other types. GOV.UK is blunt about the alternative: "If you withdraw the money without doing this, you will not be able to reinvest that part of your tax-free allowance again."
The same £400,000 of funds costs £375 or £1,400
Charges are the one item you can price exactly, because the schedules are published. They also behave in ways that only show up when a portfolio spans several accounts.
Hargreaves Lansdown tiers its fund charge: "The first £250,000 is charged at 0.35%. From £250,000 to £1mn it's 0.25%, and from £1mn to £2mn it's 0.10%." The tier is then applied account by account rather than across the relationship, and HL gives the example itself. Hold £200,000 of funds in a SIPP and £200,000 in a Fund and Share Account and each account sits inside the first tier at 0.35%, "even though your combined fund holdings total £400,000". That's £1,400 a year. The same £400,000 inside one account would reach the second tier: £875 on the first £250,000 plus £375 on the next £150,000, so £1,250. The split costs £150 a year, and nothing about the holdings changed.
Vanguard's self-managed service is built the opposite way. "You'll pay 0.15% of your invested balance a year, capped at £375", and "You only pay 1 account fee even if you have more than one account." On £400,000 invested, 0.15% is £600, so the cap binds and the charge is £375 however many accounts hold it. Below £32,000 invested the fee is a flat monthly amount instead. The chart sets the three structures side by side, and the gap between the two providers on the same £400,000 is £1,025 a year.
That comparison is not like for like, and the reason is the range. Vanguard's self-managed service holds Vanguard funds; the Hargreaves Lansdown charge buys a wide fund and share range, and its share account charge is capped at £12.50 a month. A cheaper schedule that doesn't hold what you own isn't cheaper. Our comparison of platform fees works through where a flat fee overtakes a percentage.
Fund charges sit underneath the account charge and move independently of it. The two sterling trackers used above both carry a 0.07% total expense ratio; the developed world tracker from the same provider carries 0.20%.
Compensation limits follow the firm, not the number of accounts
This is the check almost nobody runs, and it reads differently once four accounts exist. FSCS sets its limits per firm.
For cash, "On 1 December 2025 the deposit limit rose to £120,000" per eligible person, per bank, building society or credit union, with qualifying temporary high balances protected up to £1.4 million for six months. For investments the figure is lower: up to £85,000 per eligible person, per firm, where the firm failed after 1 April 2019. The £35,000 difference between those two is worth knowing before a review moves money from a cash ISA to a stocks and shares ISA under the same roof.
Pensions sit differently again. If a pension provider fails, FSCS states "100% of your claim, with no upper limit", while a SIPP operator failure is capped at £85,000 per eligible person, per firm. Our note on FSCS protection limits covers the eligibility detail, which is where most of the nuance lives.
Who inherits the pension is decided by a form, not by the will
A pension pot usually sits outside the will, because "most UK pension schemes are discretionary schemes" in the policy paper's words, and the provider pays whoever the member nominated: "The person who died will usually have nominated you (told their pension provider to give you money from their pension pot)." A beneficiary nomination made before a divorce, a remarriage or a birth is the kind of thing a once a year glance catches and nothing else does.
The tax on it turns largely on one fact, the member's age at death. Where the member died under 75, an annuity or money from a drawdown fund first accessed from 6 April 2015 carries "No tax". At 75 or over the provider deducts Income Tax from the payment, which puts it inside the recipient's own Income Tax bands: 20%, 40% between £50,271 and £125,140, and 45% above £125,140. There's a deadline buried in it too, because tax can apply where "you're paid the lump sum more than 2 years after the pension provider is told of the death".
The estate arithmetic changes from 6 April 2027. The position today is that "Unused pension funds in discretionary schemes can currently be passed on to beneficiaries after death without any Inheritance Tax charge." The announced measure "will bring most unused pension funds and death benefits within the value of a person's estate for Inheritance Tax purposes from 6 April 2027", and personal representatives rather than the scheme carry the reporting and payment. Death in service benefits are excluded.
Take the Inheritance Tax example GOV.UK publishes: an estate of £500,000 against a £325,000 threshold, so 40% of £175,000, which is £70,000 of tax. Add the same £400,000 unused pension and the estate is £900,000, the taxable slice is £575,000 and the bill is £230,000. The pension adds £160,000 of tax where previously it added none. HMRC's own estimate is that of around 213,000 estates with inheritable pension wealth in 2027 to 2028, 10,500 would owe Inheritance Tax where previously they would not, and roughly 38,500 would pay more. Our piece on pension inheritance tax runs the bill by pot size.
The case for skipping the whole exercise
An investment review checklist can cost more than it returns, and the honest version of an annual portfolio review says where.
The allocation check is the first to fall over, because in the year just measured it produced nothing worth acting on. A drift of 3.19 percentage points sits inside a 5 point band, and trading to correct it inside a dealing account realises gains that could otherwise have stayed deferred. On GOV.UK's own example, £12,600 of gains already costs £1,728 at the basic rate. The £3,000 allowance absorbs a lot less than a 3.19 point rebalance on a large portfolio.
The cost check has the same problem in reverse. A £1,025 annual saving is real, but it's a one off decision, not an annual one, and the transfer takes up to 30 calendar days. The cheapest schedule is also the narrowest one here, and £375 that doesn't hold your existing funds buys nothing.
The allowance check is the one that reliably pays, and only because the deadline is fixed. The beneficiary check costs nothing and takes minutes, which is a different argument from the others: it isn't worth money most years, it's worth £160,000 in the single year it matters.
And every review is an invitation to trade. That's the one cost in this piece that none of the published figures price.
What these figures cannot tell you
A single year of returns is a single year, and the two drift numbers here disagree about size by more than a factor of two. Neither is a forecast of the next one.
The FTSE 100 tracker stands in for an equity sleeve because it reports in sterling, which keeps the arithmetic consistent with a sterling gilt fund. It isn't a global sleeve. Over roughly the same window, the FTSE All-World Index returned 12.6% in US dollars to 30 October 2026 and the iShares Core MSCI World UCITS ETF returned 12.13% in dollars, and neither of those is comparable with a sterling gilt return without an exchange rate that this piece hasn't measured.
Factsheet returns are net asset value with income reinvested, before any account charge, so the drift arithmetic slightly overstates what a real holder kept. The gilt tracker's 7.15 year effective duration explains much of its behaviour, and a short dated gilt fund would have moved differently; its 12 month trailing yield was 4.49%, which is income the price return alone doesn't show.
Two published fee schedules are two firms, not a market. The Income Tax bands quoted are the ones GOV.UK publishes outside Scotland, which has its own. And the Inheritance Tax example assumes a single estate with no spouse exemption and no residence nil rate band, both of which can change the answer completely.
What would change the conclusion
When the announced rate changes land, two of these tables move. HMRC set out what happens to savings income in November 2025: "The basic rate will rise from 20% to 22%, the higher rate from 40% to 42%, and the additional rate from 45% to 47% from April 2027." The arithmetic on anything interest bearing outside a shelter changes at the start of the next tax year.
If per account tiering became relationship wide, the £150 penalty for holding £400,000 in two accounts rather than one disappears, and the cost check loses its most counterintuitive finding.
If the 6 April 2027 pension measure is amended before it takes effect, the £160,000 in the example reverses. It applies to deaths on or after that date, which is what makes the nomination form worth checking now rather than then.
If the two sleeves move as far apart as they did in 2022, the drift can run several times larger than 3.19 points and the allocation check stops being the one that returns nothing.
The figure worth watching isn't any single one of these. It's whether the four balances ever get added together, because every number in this piece is invisible from inside one account.