28/11/2025
𝗔𝘂𝘁𝘂𝗺𝗻 𝟮𝟬𝟮𝟱 𝗕𝘂𝗱𝗴𝗲𝘁 - 𝘄𝗵𝗮𝘁 𝘆𝗼𝘂 𝗻𝗲𝗲𝗱 𝘁𝗼 𝗸𝗻𝗼𝘄 💼
Here’s a simple summary of the key points that could affect you, your family or your business.
This is based on recent Budget announcements and longer-term proposals, which could change in the future.
𝗣𝗲𝗿𝘀𝗼𝗻𝗮𝗹 𝘁𝗮𝘅
→ Income Tax and National Insurance thresholds were due to rise with inflation after March 2028
→ These thresholds will now remain frozen until April 2031
→ Although income tax rates aren’t increasing, frozen thresholds mean more people will gradually pay tax at higher rates
𝗦𝗮𝘃𝗶𝗻𝗴𝘀, 𝗱𝗶𝘃𝗶𝗱𝗲𝗻𝗱𝘀 𝗮𝗻𝗱 𝗽𝗿𝗼𝗽𝗲𝗿𝘁𝘆
→ Dividend tax rates will rise by 2% from April 2026 for basic and higher rate taxpayers (no change for additional rate taxpayers). Dividend tax rates will increase:
→ From 8.75% to 10.75% for basic rate taxpayers
→ From 33.75% to 35.75% for higher rate taxpayers
→ Savings and property income tax rates will increase by 2% across all tax bands from April 2027. The new tax rates that will apply to savings and property income are:
→ 22% basic rate
→ 42% higher rate
→ 47% additional rate
𝗜𝗦𝗔𝘀
→ From April 2027, under 65s can save up to £12,000 a year in cash ISAs, with the remaining allowance for investments
→ Over 65s will still be able to save up to £20,000 a year in cash ISAs
𝗣𝗲𝗻𝘀𝗶𝗼𝗻𝘀
→ From April 2029, only the first £2,000 a year paid into a workplace pension via salary sacrifice will be free of National Insurance
→ Salary sacrifice contributions above £2,000 will attract National Insurance for both employees and employers
→ The State Pension will rise by 4.8% from April 2026, increasing to £12,548 under the 'triple lock'
𝗣𝗿𝗼𝗽𝗲𝗿𝘁𝘆 𝗼𝘄𝗻𝗲𝗿𝘀
→ From 2028, a new High Value Council Tax Surcharge will apply to homes valued over £2 million
→ Charges will start at £2,500 a year and increase for higher value properties
𝗜𝗻𝗵𝗲𝗿𝗶𝘁𝗮𝗻𝗰𝗲 𝘁𝗮𝘅
→ Inheritance tax thresholds will remain frozen until April 2031
→ From April 2026, 100% relief for business and agricultural property will be limited to the first £1 million, with 50% relief applying above this level
→ Any unused allowance can be transferred between spouses or civil partners, even if the first death was before April 2026
→ Pensions will be brought into the inheritance tax net from April 2027 (announced at the Autumn 2024 Budget)
𝗘𝗹𝗲𝗰𝘁𝗿𝗶𝗰 𝘃𝗲𝗵𝗶𝗰𝗹𝗲𝘀
→ From April 2028, a new Electric Vehicle Excise Duty (eVED) will be introduced
→ This will be a mileage-based charge for electric vehicles, including plug-in hybrids. Rates will start at:
→ 3p per mile for battery electric vehicles
→ 1.5p per mile for plug-in hybrids
The changes won’t affect everyone in the same way, but they do make planning more important than ever.
If you’d like to understand what this means for your own situation - whether that’s personal tax, investments, retirement or your business, I’m happy to help - just get in touch for a chat.