AUTUMN BUDGET 2025

If you’ve turned on the TV, looked on social media or even bought a newspaper over the last week, chances are that you’ve seen Budget this and Budget that. So what you probably don’t need is a complete breakdown of every new thing that was announced. What you probably want is a list of things that you need to think about.

So we’ve provided what we think you really need to know and, of course, we’ll be here to help you navigate it. That said, everyone is different and if you have any questions or concerns, please do not hesitate to reach out to me and the team.

Our Autumn Budget Picks

1. PERSONAL INCOME AND ALLOWANCES

Dividend tax rates rise by 2% from April 2026 – important for company directors taking earnings via dividends. A client of ours with a typical mix of £12,570 salary and £37,700 dividends will see their annual tax bill rise from £3,069 to £3,813 - an increase of £744.

From April 2027, savings income and property income tax rates also rise by 2%.

Income tax thresholds are frozen until 2031, meaning as your income grows with inflation, a higher amount of your future earnings may fall into higher tax bands.

If your income is over £100,000, remember your personal allowance tapers and disappears at £125,140. No changes here.

2. PROPERTY OWNERS AND LANDLORDS

Property income tax rises by 2% across all bands from April 2027.

New mansion tax applies to homes worth over £2m from April 2028 (surcharge £2,500–£7,500).

Capital gains tax rates remain the same, but planning around property sales may be needed.

3. BUSINESS OWNERS

National Living Wage and Minimum Wage rise significantly from April 2026 – budget now for increased staffing costs.

Salary sacrifice pension contributions above £2,000/year will be subject to NICs from April 2029.

Corporation tax remains unchanged, but dividend tax rises mean reviewing your remuneration strategy is essential.

Capital allowances change:

First-year allowance on equipment increases from January 2026.

Writing down allowance drops from 18% to 14% in April 2026.

4. COMPANY DIRECTORS & SHAREHOLDERS

Dividend tax rises by 2 percentage points from April 2026 (the additional rate remains unchanged).

If you are using dividends for extraction, review whether your current mix of salary/dividends is still optimal.

EMI scheme eligibility increases significantly from 2026 – good news for growing companies looking to offer share options.

5. SAVINGS AND INVESTMENTS

ISA overall annual limit stays at £20,000, but from April 2027:

Under-65s can only invest £12,000 in a cash ISA.

Savings income tax rates increase by 2% from April 2027.

Venture Capital Trust (VCT) income tax relief drops from 30% to 20% from April 2026.

6. INHERITANCE TAX (IHT)

Nil rate bands frozen until 2031.

Agricultural and Business Property Relief capped at £1m combined from April 2026.

Unused allowances can be transferred to a spouse/civil partner – an important planning point.

AIM shares drop from 100% to 50% BPR relief from April 2026.

Pension funds will be counted in the estate from April 2027 – major planning change.