Autumn Budget 2025

Please find below our summary of the Autumn Budget delivered by the Chancellor, Rachel Reeves, on Wednesday 26 November.

Income tax and other main tax rates remain essentially unchanged and frozen for longer, but the taxation of dividends, savings income and property income will rise over the next few years.

Among the wide range of measures were:

Personal Allowance and Tax Thresholds:

• The personal allowance and the existing income-tax thresholds remain fixed at their current cash values for a further three years to 2030/31.

Tax on Dividends:

• Tax rates on dividends will increase by 2% from 2026/27, except for the additional rate on dividends which will stay at 39.35%

Tax on Savings Income:

• Savings income rates will increase by 2% in 2027/28.

Tax on Property Income:

• Property income rates will also increase by 2% in England and Northern Ireland in 2027/28, however due to the devolution of property income tax rates in Scotland, we await the Scottish government delivering their budget on 13 January 2026 to find out how this will affect Scottish taxpayers.

Electric Vehicle Excise Duty:

• A new usage-based Electric Vehicle Excise Duty (eVED) will be introduced from April 2028 establishing a charge per mile for electric cars. Average EV drivers are expected to pay around £240 a year initially and plug-in hybrid cars will attract a reduced rate.

Changes to Pensions via Salary Sacrifice:

• From 6 April 2029, the amount that an employee may contribute to a pension through salary sacrifice without paying national insurance contributions (NICs) will be capped at £2,000 a year.

Changes to ISA’s:

• The individual savings account (ISA) subscription limit remains £20,000. But from April 2027, savers under age 65 must invest at least £8,000 of the annual ISA allowance in qualifying investments such as shares and authorised funds, rather than in cash.

As ever the Budget publications contained a wide range of detailed proposals and much to digest. Our Budget summary highlights the key aspects likely to affect you. If you have any questions about what you should do next, please get in touch.

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