Autumn Budget 2025
- info1984908
- Dec 3
- 2 min read
What the Autumn Budget 2025 Means for UK Taxpayers
The UK Autumn Budget 2025 introduced a sweeping set of tax reforms affecting earners, savers, investors, landlords, and homeowners. Whether you’re planning your finances or preparing your business for the next few years, understanding these changes and when they take effect is essential.
Key Tax Changes & When They Take Effect (Autumn Budget 2025)
Income Tax & National Insurance Threshold Freeze (Until 2031)
The government has extended the freeze on income-tax and NI thresholds to April 2031.This means as wages rise, more taxpayers may move into higher tax brackets a phenomenon known as fiscal drag.
Impact: employees, self-employed workers, retirees with income, employers.
Dividend Tax Rates Increase (From April 2026)
Dividend tax rates will rise by 2 percentage points across basic, higher and additional rates.
Impact: small business owners, investors, anyone drawing dividend income.
Higher Tax on Savings & Property Income (From April 2027)
Tax on savings interest and rental income will increase by 2 percentage points. This brings savings, investments, and landlord income into a higher tax bracket sooner.
Impact: savers, landlords, investors, higher-income households.
High-Value Property Surcharge (From April 2028)
Homes worth £2 million+ will face a new annual surcharge. Higher-value bands face correspondingly higher charges.
Impact: homeowners in London and the South East, second-home owners, property investors.
Pension Salary-Sacrifice Reform (From April 2029)
Salary-sacrifice pension contributions above £2,000 per year will lose their National Insurance exemption.
Impact: employees using salary sacrifice for pensions, employers, high earners.
ISA Rule Changes (From April 2027)
Cash ISA allowance for under-65s will drop from £20,000 to £12,000.To use the full £20,000 limit, savers will need to allocate part of it to a Stocks & Shares ISA.
Impact: savers, income investors, low-risk households.
Electric Vehicle Mileage Tax (From 2028/29)
A new mileage-based tax for EV and plug-in hybrid drivers will replace lost fuel-duty revenue.
Impact: EV and hybrid owners, fleet operators, households transitioning to electric transport.
Fuel Duty Update
Fuel duty freeze ends in September 2026, with gradual increases expected afterward.
New Tax Compliance & Anti-Avoidance Measures (Through 2030–31)
The government will introduce stronger enforcement tools, anti-avoidance rules, new reporting requirements, and enhanced tax-debt recovery processes.
Impact: businesses, tax advisers, high-income individuals, anyone with complex tax arrangements.
Tax Change Timeline at a Glance
2026: Dividend tax rise
2027: Savings & property income tax increase; ISA rule changes
2028: High-value property surcharge
2028–29: EV mileage tax
2029: Pension salary-sacrifice changes
2031: Income-tax threshold freeze ends
Comments