Autumn Budget 2025: At a glance

The Chancellor, Rachel Reeves, presented her Autumn Budget on 26 November 2025. This is our 'At a glance' summary of the key tax announcements and measures.

Autumn Budget 2025 3

Introduction

One of the key aims of the current Government, laid down in its manifesto and since reaffirmed, is economic growth.

In October 2024, the Government set its ‘non-negotiable’ fiscal rules with the aim of supporting economic and fiscal stability while ensuring accountability and transparency. Under these rules, it intends:

  • That day-to-day public spending, such as on welfare and public services, will be met by revenue by 2029-30.
  • For net financial debt to fall as a share of UK economic output in 2029-30.

In March 2025, the Office for Budget Responsibility (OBR) estimated that the Government was on course to meet its projected targets, but only by ‘small margins’ with a ‘significant risk’ around the budget forecast.

This OBR estimate was based on plans to reduce welfare spending, but those plans were scaled back in June 2025, giving the Chancellor less room for fiscal manoeuvre over the subsequent months.

Amid rife speculation over the Budget, a ‘Scene Setter’ speech was presented by the Chancellor on 4 November 2025. She laid down that the Budget would be focused on the priorities of the British people: 

  • Protecting the NHS.
  • Reducing the national debt.
  • Improving the cost of living.  

The Chancellor said that if we are to build the future of Britain together, we will all have to contribute to that effort; each of us must do our bit for the security of our country and the brightness of its future. 

Many saw this as an indication that tax rises were on the way, despite Labour’s much-quoted manifesto pledge not to increase taxes on working people, including National Insurance, Income Tax, and VAT. 

The Chancellor said that the world had thrown more challenges our way, with global supply chain issues, high borrowing costs, tariffs, and weaker-than-expected productivity affecting the UK economy and the Government’s approach to it.

It is with this background that Rachel Reeves took to the Dispatch Box on 26 November, outlining her policies to raise £26 billion in taxes, an all-time high. The speech had been preempted by the unprecedented release of her main policies by the OBR earlier in the morning.

Addressing the House of Commons, the Chancellor apologised for the OBR's early release, which was swiftly withdrawn, but not before media outlets and tax commentators saw it.

Before introducing the Chancellor, the Deputy Speaker, Nusrat Ghani, who is also the chairwoman of the Ways and Means Committee, took the unusual step of making a statement to the House. She criticised the "Extensive briefing to the media on the Government's fiscal policy and public finances," pointing out that it had been going on under several governments but was getting worse, and the OBR leak capped it all.

"This all falls short of the standards that the House expects... the premature disclosure of the budget has always been regarded as a supreme discourtesy to this House," said Ms Ghani. She added that when Parliament was sitting, all government policies should be reported to it before being made public.

Amid the howling of both sides of the House, Ms Reeves reiterated the research from the OBR.

The Economic and Fiscal Outlook (EFO) sets out the OBR's central forecast and the uncertainties that surround it for the five years to 2030-31.

Economic growth

  • The OBR now forecast real GDP growth of 1.5% in 2025, 0.5 percentage points faster than in the March Economic and fiscal outlook.
  • A reduction to the forecast for the underlying rate of productivity growth in the medium term to 1.0%, 0.3 percentage points slower than in the March forecast.  
  • With estimated medium-term growth in labour supply and capital deepening unchanged at 0.5% and 0.2% respectively, medium-term potential output growth has been revised down by 0.3 percentage points to 1.5%
  • The downward revision to productivity is not the only material change to our economy forecast since March. The OBR has also revised up the near-term forecast for earnings growth and inflation.
  • Greater domestically generated inflation, alongside higher food prices, means the OBR also expects inflation to stay higher for longer than in March.
  • The unemployment rate has been on a gradual upward trend since a post-pandemic trough of 3.8% in 2022, and is expected to remain close to its current rate of around 5% until 2027. 
  • The overall impact of these changes is that growth in the nominal economy has not been downgraded by as much as productivity, and the composition of nominal GDP growth is more tax-rich than in March.

Fiscal outlook

  • The changes to the economy described above boost overall tax receipts relative to the March forecast by £16 billion in 2029-30, before accounting for Budget policies.
  • The impact on public sector net borrowing of the higher pre-measures receipts forecast is more than offset by a £22 billion increase in the pre-measures spending forecast by 2029-30, relative to March. 
  • Before accounting for Budget policies, these forecast changes left borrowing £17 billion higher this year and £6 billion higher in 2029-30. 
  • In the face of this comparatively modest medium-term deterioration in the pre-measures fiscal outlook, the direct effects of Budget policies increase borrowing by £6 billion next year but reduce it by £15 billion in 2029-30.
  • Spending policies in this Budget increase borrowing every year, by £7 billion next year and by £11 billion in 2029-30.
  • Tax increases raise £0.7 billion next year and £26 billion in 2029-30, more than offsetting the increase in spending by the final years of the forecast.
  • The indirect effects of Budget policy measures on the economy are estimated to lower borrowing by £2 billion in 2026-27, largely thanks to the impact of lower inflation on debt interest spending.
  • Incorporating both pre-measures changes and the impacts of policy, National Accounts taxes as a share of GDP are forecast to increase from 35% in 2024-25 to an all-time high of just over 38% from 2029-30 onward. 
  • Spending as a share of GDP is forecast to rise from 44% in 2024-25 to 45% in 2025-26 and then fall back to 44% of GDP by 2030-31. 
  • Borrowing as a share of GDP is projected to fall from 5.1% last year to 4.5% this year, and then decline to 1.9% of GDP in 2030-31.
  • Public sector net debt (PSND) is forecast to rise from 95.0% of GDP this year to a peak of 97.0% of GDP in 2028-29. 

Index to sections below

Each section below contains a link to our subscriber guide on the announcements made. These guides contain detailed analysis and commentary, and will continue to be updated over the days following the Budget.

To subscribe and access our exclusive subscriber content, Click here.

Capital Allowances

Writing Down Allowances

It is proposed that from 1 April 2026 (Corporation Tax)/6 April 2026 (Income Tax):

  • The main rate of the Writing Down Allowances will reduce from 18% to 14%.

New 40% First Year Allowance (FYA)

It is proposed that from 1 January 2026:

  • A new 40% FYA will be introduced for main rate expenditure for both Income Tax and Corporation Tax.
  • This will apply to new expenditure on eligible assets, including plant or machinery for leasing, but excluding second-hand assets and cars.

First Year Allowance (FYA) for zero-emission cars and electric vehicle charge points

It is proposed that from 1/6 April 2026: 

  • 100% FYAs for cars with zero CO2 emissions and electric vehicle charge-points will be extended for Income Tax and Corporation Tax purposes by one year, to 5 April and 31 March 2027, respectively.

See: Capital Allowances: Autumn Budget 2025

Capital Gains Tax (CGT)

Employee Ownership Trusts: reduction of relief 

From 26 November 2025: 

  • The amount of CGT relief available on qualifying disposals of shares made to the trustees of an Employee Ownership Trust (EOT) will reduce to 50% of the gain.
    • 50% of the gain on disposal to the trustees of an EOT will be treated as the disposer’s chargeable gain for CGT purposes.
    • The remaining 50% of the gain will not be chargeable at the time of disposal but will continue to be held over to come into charge on any future disposal of the shares by the trustees of the EOT.

Incorporation Relief: new requirement to claim

It is proposed that for transfers made on or after 6 April 2026: 

  • Individuals will be required to actively claim Incorporation Relief via Self Assessment when transferring a business to a company, rather than the relief being applied automatically.

Amendments to the share exchange and reconstruction rules

From 26 November 2025: 

  • Anti-avoidance rules are strengthened for share exchanges and company reconstructions by allowing HMRC to block arrangements that are designed to avoid CGT and Corporation Tax.
  • This measure amends the existing rules by ensuring that they apply to those persons who have entered into arrangements where the main purpose, or one of the main purposes, of the arrangement is to secure a tax advantage that they would not ordinarily have been entitled to.

Non-resident capital gains

From 26 November 2025: 

  • The non-resident CGT rules will be amended, closing loopholes for protected cell companies and clarifying legislation for investors. Further administrative reforms will apply from 6 April 2026. 

Cryptoasset loans and liquidity pools 

  • A summary of responses to the ‘Taxation of decentralised finance (DeFi) involving the lending and staking of cryptoassets’ consultation has been published.

See: Capital Gains Tax: Autumn Budget 2025

Companies

Loans to participators

It is proposed that from 6 April 2026: 

  • The rate of s.455 tax charged on loans to participators in close companies will increase to 35.75%.

Venture Capital Trusts (VCTs) and the Enterprise Investment Scheme (EIS)

It is proposed that from 6 April 2026: 

  • The VCT and EIS company investment limit will increase to £10 million and £20 million for Knowledge-Intensive Companies (KICs).
  • The lifetime company investment limit will increase to £24 million, and £40 million for KICs. 
  • The gross assets test will increase to £30 million before the share issue, and £35 million after.

Targeted Research and Development (R&D) advance assurance service

  • The Government will pilot a targeted advance assurance service from spring 2026, enabling small and medium-sized enterprises to gain clarity on key aspects of their R&D tax relief claims before submitting to HMRC.
  • The Government has also published a summary of responses to the advance clearance consultation.

Advanced Corporation Tax (ACT) reform

It is proposed that from 1 April 2026: 

  • The rules will be abolished relating to shadow ACT restrictions in order to relax the limits on companies’ use of their surplus ACT balances to offset their Corporation Tax liabilities.
  • This measure applies to companies with remaining surplus ACT balances and does not introduce new thresholds or exemptions. 

Charity compliance

It is proposed that from 6 April 2026: 

  • Legislation will strengthen the charity tax rules on tainted donations, approved investments and non-charitable expenditure. 

Creative Industries and Research & Development Expenditure Credits: administrative measure

It is proposed that for payments made on or after 26 November 2025:

  • Legislation will set out the treatment for Corporation Tax purposes of intra-group payments made in return for surrendered Research & Development Expenditure Credit (RDEC), Audio-Visual Expenditure Credit (AVEC) and Video Games Expenditure Credit (VGEC). 

Modernising and standardising Corporation Tax submissions

  • The Government will consult in early 2026 on delivery timescales and enforcement for prescribing the content and tagging of the Corporation Tax computation.

Reporting company payments to participators

  • The Government will publish a consultation in early 2026 to explore introducing new requirements to report transactions between close companies and their shareholders to HMRC.

Entrepreneurship in the UK

  • The Government has issued a prospectus outlining the actions it is taking to support scaling companies. The aim is to reduce barriers for entrepreneurs and key investors to boost economic growth. 
  • It has also issued a Call for Evidence to address the shortfall in domestic scale-up capital, which has led to an 'incubator' economy where some of the most innovative ideas, companies and founders are driven to move abroad. 

See: Companies: Autumn Budget 2025

Compliance & Administration

Double late filing penalties for Corporation Tax

It is proposed that for Corporation Tax returns due to be filed on or after 1 April 2026:

  • The value of late filing penalties will double. The penalty for: 
    • The first instance of filing a return late will increase from £100 to £200.
    • Filing more than three months late will increase from £200 to £400.
    • Three successive failures will increase from £500 to £1,000.
    • Three successive failures where the return is more than three months late will increase from £1,000 to £2,000.

Late payment penalties: VAT and Income Tax

It is proposed that from April 2027: 

  • Late payment penalties for VAT and Income Tax Self Assessment will increase. Late Payment Penalty (LPP) 1 will rise from 3% to 4% at day 16, and from 3% to 4% at day 31, while the per annum rate for LPP 2 remains at 10% per year.

VAT and PAYE timely payments 

  • The Government will publish a consultation in early 2026, considering ways VAT and Pay As You Earn (PAYE) liabilities can be paid promptly without the taxpayer falling behind on their payments, including requiring more tax payments by direct debit.

Informants of high-value tax fraud

From 26 November 2025:  

  • Rewards paid to informants who provide HMRC with high-value information will increase. 
  • For high-value tax recoveries over £1.5 million, HMRC will pay rewards up to 30% of the additional tax collected that would otherwise have gone unpaid.

Expanding tax conditionality to new sectors 

  • The Government has published a summary of responses to the ‘Tackling the hidden economy by expanding tax conditionality to new sectors’ consultation.
  • This confirms plans to extend tax conditionality to the waste and animal welfare sectors and additional transport licences.
  • Draft legislation will be published for a technical consultation in 2026.

Digital prompts for VAT and Corporation Tax

It is proposed that from April 2027 and 2028

  • The Government will invest £59 million over the next five years to introduce Transactional Risking (TR), which delivers real-time, data-driven nudges within HMRC’s digital services to help VAT and Corporation Tax (CT) taxpayers get their tax right before submitting returns.
  • The measure applies to VAT and CT taxpayers using compatible third-party software and will be rolled out gradually as software developers integrate TR functionality.
  • This measure will be effective from April 2027 for VAT and April 2028 for CT. 

Behavioural penalties reform

  • The Government has published a summary of responses to the ‘Reform of Behavioural Penalties’ consultation. The Government intends to modernise HMRC’s inaccuracy and failure to notify penalties.

HMRC's debt management

It is proposed that from November 2025:

  • £64m of additional funding over the next 5 years will increase HMRC's debt management capacity through expanding the existing use of third-party Debt Collection Agencies (DCAs) to increase the collection of overdue tax debt.
  • Both new debts and debt stock over 12 months old will be placed with DCAs.

It is proposed that from 1 April 2027:

  • Investment of £89m over the next five years will fund more HMRC debt management staff to increase HMRC’s capacity to collect tax debts. 

The Government has published a new tax debt strategy, outlining HMRC’s approach to reducing tax debt as a percentage of receipts, and to improving debt management and customer support. 

Fraud in the Construction Industry Scheme (CIS)

It is proposed that from 6 April 2026: 

  • HMRC's powers to tackle fraud within the CIS will be strengthened.
  • Where a business makes or receives a payment they knew or should have known was connected to fraud, HMRC will have powers to remove Gross Payment Status (GPS) immediately, assess the business for the tax lost, and charge a penalty of up to 30% on the business or the business’s officers.
  • The time limit for reapplication, where GPS has been immediately removed, will be increased from one year to five years.

Tax advisers who facilitate non-compliance

It is proposed that from 1 April 2026: 

  • HMRC’s powers will be enhanced to act against tax advisers who deliberately seek to facilitate non-compliance in their clients’ tax affairs.
  • HMRC will be able to access information more efficiently from advisers suspected of deliberate non-compliance, and apply penalties proportionate to the value of non-compliance.
  • The measure applies to all tax advisers (including individuals, firms, and corporate entities) who are suspected of deliberately facilitating non-compliance.

Closing in on promoters of marketed tax avoidance

  • The Government will introduce new powers to close in on promoters of marketed tax avoidance.
  • A consultation on further measures to tackle promoters will be published in early 2026.

Raising standards in the tax advice market

  • Following consultation, the Government will not regulate tax advisers and will work in partnership with the sector to raise standards in the tax advice market.

Reducing non-compliance from uncertain tax treatments

  • The Government will publish a consultation in early 2026 on proposals to enhance the existing notification regime for uncertain tax treatments.

Tackling non-compliance on the high street

  • The Government will establish a new dedicated small business evasion and enforcement team and deploy 350 HMRC criminal investigators to carry out more targeted criminal interventions, tackling the most serious fraud and evasion by small businesses.

Clamping down on electronic sales suppression 

  • The Government will publish a call for evidence in early 2026 relating to software standards for the Electronic and Mobile Point of Sale Sector to explore how best to embed standards across the latest products and innovations.

Call for Evidence into the tax support for entrepreneurs

  • The Government has published a Call for Evidence that seeks views on the effectiveness of existing tax incentives, and the wider tax system for business founders and scaling firms, and how the UK can better support these companies to start, scale and stay in the UK.
  • The Call for Evidence closes on 28 February 2026

Recklessness offence for direct tax 

  • The Government will publish a consultation in early 2026 on the introduction of a new ‘recklessness’ criminal offence for fraudulently evading direct taxes, to align with existing indirect tax offences.

Making better use of third-party data

  • The Government will acquire third-party data more frequently for interest income and card sales from April 2028.

Enhancing tax transparency on real estate

  • The UK intends to participate in a new international agreement, which will tackle tax evasion by providing for the automatic exchange of readily available information on real estate from 2029 or 2030. 

Enhancing HMRC’s powers to ensure taxpayer errors in tax returns are corrected

  • The Government will consult on draft legislation in 2026 on new HMRC powers obliging taxpayers to correct inaccuracies where they are identified.

Tax Update event

  • The Government will announce further changes to simplify and improve tax and customs administration at a Tax Update in early 2026.

Domestic reporting of UK resident cryptoasset users

It is proposed that on and after the date of Royal Assent to Finance Bill 2025-26: 

  • UK-based reporting cryptoasset service providers (RCASPs) will be required to report tax-relevant information regarding their UK cryptoasset customers to HMRC.
  • The Cryptoasset Reporting Framework already requires RCASPS to report this information regarding their non-UK cryptoasset customers.

Modernising digital outbound communications

It is proposed that from spring 2026:

  • HMRC will be able to operate a 'digital by default' model for outbound communications.
    • Taxpayers that use HMRC's digital services will automatically receive digital letters instead of letters by post.
  • Rollout is to be gradual as different services and IT systems become ready.
  • Taxpayers will be able to opt out, and digitally excluded customers will continue to receive paper communications.

See: Compliance & Administration: Autumn Budget 2025

Employment Taxes

Salary Sacrifice: limit to NI relief for pension contributions

It is proposed that from 6 April 2029: 

  • Class 1 Employee (Primary) and Employer (Secondary) NICs will apply to salary sacrifice pension contributions above an annual cap of £2,000.

Non-reimbursed homeworking expenses: removal of tax relief

It is proposed that from 6 April 2026:

  • Employees will no longer be able to claim a deduction from earnings where they have incurred additional household costs when being required to work from home.
  • Employers can still reimburse employees for such costs where eligible, without deducting Income Tax and NICs. 

Employer NICs relief for veterans

It is proposed that from 6 April 2026:

  • The employer NICs relief for employers hiring veterans in their first civilian role will be extended until to 5 April 2028.
  • Thereafter, support for veterans into employment will be covered through spending review settlements rather than through this tax relief. 

Benefit-In-Kind tax easement for Plug-in Hybrid Electric Vehicle (PHEV) company cars

It is proposed that from 1 January 2025 (retrospectively) to 5 April 2028: 

  • An easement will mitigate the Benefit-In-Kind (BIK) tax impact of new emissions standards for employees who receive a PHEV company car from their employer, and employers who provide PHEV company cars.
  • Anyone accessing an eligible PHEV company car on or before 5 April 2028 will remain eligible for the easement until the earlier of variation or renewal of the arrangement or 5 April 2031.

Employee Car Ownership schemes (ECOS)

It is proposed that: 

  • The intended change to bring employee car ownership schemes into scope of the Benefit in Kind rules from 6 April 2026 will be delayed to 6 April 2030, with transitional arrangements for employees still in arrangements before that date until the earlier of the end of April 2031 or the end of their arrangement.

Van Benefit Charge and Car and Van Fuel Benefit Charges for 2026-27

It is proposed that from 6 April 2026:

  • The Van Benefit Charge and Car and Van Fuel Benefit Charges will be uplifted by CPI.

Enterprise Management Incentive (EMI)

It is proposed that from April 2026:

  • The employee limit will increase from 250 to 500, the gross assets test will increase from £30 million to £120 million, and the company share option limit will increase from £3 million to £6 million.
  • The maximum holding period will increase to 15 years, from 10 years, including in respect of existing EMI contracts.
  • The EMI notification requirement will be removed from April 2027. 

Expanding workplace benefits relief 

It is proposed that from 6 April 2026: 

  • The Income Tax and NI exemption for employer-provided benefits will be extended to cover reimbursements for eye tests, home working equipment, and flu vaccinations. 

National Living Wage (NLW) and National Minimum Wage (NMW)

It is proposed that from 1 April 2026:

  • The NLW for those over 21 will increase to £12.71 per hour.
  • The NMW for those aged 18-20 will increase to £10.85 per hour.
  • The apprentice rate and NMW for those aged 16 and 17 will increase to £8.00 per hour.
  • The accommodation offset will increase to £11.10 per day.

Image rights payments

It is proposed that from 6 April 2027: 

  • Legislation will make all payments for image rights related to an employment taxable as employment income and subject to Income Tax, and employer and employee NICs.
  • This will apply to all such payments, with no exemptions or thresholds specified, and includes deemed employments. 

Defined Benefit (DB) Pension Scheme Surplus Extraction

It is proposed that from April 2027: 

  • Trustees of more DB schemes will be allowed to change scheme rules to share surplus funds with sponsoring employers and scheme members.
  • This will authorise direct payments to scheme members for tax purposes to support trustee-employer negotiations and amend the threshold at which schemes can release surplus.

Loan Charge (LC) review

The Loan Charge review’s report has been published at Budget 2025, alongside the /Government’s response.

  • The Government is accepting all but one of the review’s recommendations.
  • The review recommends that the Government introduce a settlement opportunity to encourage those who have not settled their avoidance with HMRC to do so.
    • The settlement opportunity will allow people to settle their loan charge liabilities with HMRC on concessionary terms.
    • Under the terms of the settlement opportunity, everyone who comes forward will see a £5,000 reduction in their outstanding liabilities.
    • They will also be able to offset a proportion of the fees assumed to have been paid to the promoters of the schemes against their liabilities.
    • HMRC will also forgo all late payment interest, will not collect any IHT that has arisen from the use of trust structures, and will only charge penalties in egregious cases.
    • The maximum deduction will be £70,000.
  • This measure will be effective from Royal Assent to Finance Act 2026.

EMI and Company Share Option Plan (CSOP): Private Intermittent Securities and Capital Exchange System (PISCES) reform

  • The Government will allow existing EMI and CSOP contracts to be amended to include PISCES as an exercisable event. This will be legislated for in Finance Bill 2026-27, applying to contracts agreed before 6 April 2028. The changes take effect retrospectively from 15 May 2025.

Share Incentive Plans (SIPs)

  • A summary of responses to the 2023 Call For Evidence on SIPs and Save As You Earn (SAYE) has been published.

Tax treatment of payments for cancelled shifts

  • The Government will introduce legislation to confirm the Income Tax treatment of payments introduced by section 27BP of the Employment Rights Act 1996 for shifts cancelled, moved or curtailed at short notice. This confirms that these payments are earnings and therefore subject to tax from 2026.

Collective money purchase: registration of unconnected multiple employer schemes

It is proposed that from the date of Royal Assent to Finance Bill 2025-26:

  • Legislation will treat unconnected, multiple-employer collective money purchase schemes as occupational pension schemes. This will allow them to apply to HMRC to become a registered pension scheme and operate as intended.

PAYE changes for the umbrella company market

It is proposed that from 6 April 2026:

  • Employment agencies and end clients will be jointly and severally liable for any amount required to be accounted for under PAYE, where an umbrella company forms part of a labour supply chain. 

See: Employment Taxes: Autumn Budget 2025

Income Tax and National Insurance (for individuals)

Income Tax thresholds

It is proposed that from 6 April 2028 to 5 April 2031: 

  • The Personal Allowance will be frozen at £12,570.
  • The higher rate threshold will be frozen at £50,270.
  • The additional rate threshold will be frozen at £125,140.

Income Tax rates: dividend income

It is proposed that from 6 April 2026:

  • The rates of Income Tax applying to dividend income will increase. The dividend: 
    • Ordinary rate will be 10.75% (currently 8.75%.
    • Upper rate will be 35.75% (currently 33.75%).
  • The additional rate will remain unchanged at 39.35%.

Income Tax rates: property income

It is proposed that from 6 April 2027: 

  • A separate rate of Income Tax will apply to property income. The property:
    • Basic rate will be 22% 
    • Higher rate will be 42%
    • Additional rate will be 47%.
  • These rates will apply across England, Wales and Northern Ireland.
    • The Government will engage with the devolved governments of Scotland and Wales to provide them with the ability to set property income rates in line with their current Income Tax powers in their fiscal frameworks

Income Tax rates: savings income

It is proposed that from 6 April 2027: 

  • A separate rate of Income Tax will apply to savings income. The savings:
    • Basic rate will be 22% 
    • Higher rate will be 42%
    • Additional rate will be 47%.

Starting rate for savings and personal savings allowance

It is proposed that:

  • The starting rate for savings will remain at £5,000 until 2030-31.
  • For 2026-27, the personal savings allowance will remain at £1,000 for basic rate taxpayers and £500 for higher rate taxpayers.

Ordering of Income Tax reliefs and allowances

It is proposed that from 6 April 2027:

  • Reliefs and allowances deductible at steps 2 and 3 of the Income Tax calculation will only be applied to property, savings and dividend income after they have been applied to other sources of income. 

Married Couple’s Allowance and Blind Person’s Allowance

It is proposed that from 6 April 2026: 

  • The Married Couple’s Allowance and the Blind Person’s Allowance will be uprated by the September 2025 CPI rate of 3.8%. 

National Insurance (NI) thresholds

It is proposed that from 6 April 2026:

  • The Lower Earnings Limit (Class 1) will increase to £6,708 per annum (£129 per week).
  • The Small Profits Threshold (Class 2) will increase to £7,105 per annum.

It is proposed that from 6 April 2028 to 5 April 2031, the: 

  • Secondary Threshold will remain at £5,000. 
  • Primary Threshold (Class 1) and Lower Profits Limit (Class 4) will be frozen at £12,570.
  • Upper Earnings Limit (UEL) (Class 1) and Upper Profits Limit (UPL) (Class 4) will be maintained at £50,270.
  • The Upper Secondary Threshold (Class 1) and Apprentices Upper Secondary Threshold (Class 1) will stay fixed at £50,270 per annum until 5 April 2031, to remain aligned with the UEL and UPL. 

National Insurance (NI) thresholds

It is proposed that from 6 April 2026:

  • The main Class 2 rate will increase to £3.65 per week.
  • The Class 3 rate will increase to £18.40 per week.

Student Loans: Plan 2 repayment threshold

It is proposed that from 6 April 2027:

  • The repayment threshold for plan 2 student loans will remain at its 2026-27 level (£29,385) until 6 April 2030, when it will increase annually by inflation.

Venture Capital Trusts (VCTs)

It is proposed that from 6 April 2026: 

  • VCT Income Tax relief will decrease to 20%, from 30%. 

Individual Savings Accounts (ISAs)

It is proposed that from 6 April 2027:

  • The total ISA annual subscription limit will remain at £20,000, with the cash limit reduced to £12,000 for under-65s from April 2027.
  • Annual subscription limits will remain at £20,000 for ISAs, £4,000 for Lifetime ISAs and £9,000 for Junior ISAs and Child Trust Funds until 5 April 2031.

Lifetime ISA reform 

  • The Government will publish a consultation in early 2026 on the implementation of a new, simpler ISA product to support first time buyers to buy a home. Once available, this new product will be offered in place of the Lifetime ISA.

Help to Save

It is proposed that:

  • The Help to Save scheme will be made permanent, with eligibility expanded to include all Universal Credit claimants in receipt of the child and/or carer’s element from April 2028. 

Making Tax Digital (MTD): transitional penalties

It is proposed that from 6 April 2026:

  • The Government will not apply late submission penalties to quarterly updates for the 2026-27 tax year for Income Tax Self Assessment taxpayers required to join MTD from April 2026 (sole traders and landlords with qualifying income over £50,000).
  • Penalties for missing the annual update will still apply in this first year, and taxpayers will still need to submit their quarterly updates before they can submit their annual tax return.
  • The Government will apply the new penalty regime for late submission and late payment to all Income Tax Self Assessment taxpayers not already due to join the new system from 6 April 2027.

Making Tax Digital (MTD): Treatment for small taxpayer groups

  • The Government will exempt one very small taxpayer group from MTD and will defer the start date to April 2027 for some others. 

Making Tax Digital (MTD) administrative changes

It is proposed that from 1 April 2026: 

  • New powers will ensure MTD and the new penalty reform legislation work as intended.

Self Assessment taxpayers with Pay as You Earn (PAYE) income

From 6 April 2029: 

  • Income Tax Self Assessment (ITSA) taxpayers with Pay as You Earn (PAYE) income will be required to pay their ITSA tax liabilities in-year through deductions from their PAYE income.
  • Employers and pension providers will receive a tax code to enable the ITSA liability to be collected from the individual’s pay, provided there are sufficient funds to accommodate the deduction.
  • The Government will publish a consultation in early 2026.

Administrative Changes to Expenses and Record-Keeping for Childminders

  • The Government confirms HMRC will update its guidance to clarify that childminders within MTD for Income Tax from April 2026 must follow MTD rules.
  • For other childminders, HMRC will clarify how existing arrangements apply to those working from non-domestic premises.

State Pension and Simple Assessment

It is proposed that from 6 April 2027:

  • The Government will ease the administrative burden for pensioners whose sole income is the basic or new State Pension without any increments, so that they do not have to pay small amounts of tax via Simple Assessment from 2027-28 if the new or basic State Pension exceeds the Personal Allowance from that point.
  • The Government is exploring the best way to achieve this and will set out more detail next year.

Qualifying Care Relief 

It is proposed that from 6 April 2026: 

  • Qualifying Care Relief, the amount of Income Tax relief available to foster carers and shared lives carers, will be uprated by the September 2025 CPI rate of 3.8%.

Winter Fuel Payments

From 6 April 2025: 

  • Pensioners with a total income of over £35,000 will have to repay their Winter Fuel Payment. The £35,000 threshold will be maintained for this Parliament. 

Charity compliance

It is proposed that from 6 April 2026: 

  • Legislation will strengthen the charity tax rules on tainted donations, approved investments and non-charitable expenditure. 

See: Income Tax and National Insurance (for individuals): Autumn Budget 2025

Inheritance Tax (IHT)

IHT thresholds

It is proposed that from 6 April 2030, the following thresholds will be further frozen for one year: 

  • Nil Rate Band: £325,000.
  • Residence Nil Rate Band: £175,000. 
  • Residence Nil Rate Band taper: £2 million.
  • Limit of 100% relief for Agricultural Property Relief and Business Property Relief: £1 million.

Agricultural Property Relief (APR) and Business Property Relief (BPR)

It is proposed that from 6 April 2026: 

  • Any unused portion of the £1 million APR/BPR limit (where 100% rates of relief apply) will be transferable between spouses and civil partners, similar to the existing rules for the Nil-Rate Band and Residence Nil-Rate Band, including if the first death was before 6 April 2026. 

UPDATE:   It was announced in December 2025 that the 100% IHT allowance for assets qualifying for APR and BPR will increase: 

  • The allowance will increase from £1 million to £2.5 million. 
  • Changes will take effect from 6 April 2026. 
  • Any unused allowance is still transferable between spouses and civil partners.  

Infected Blood Compensation Payments

It is proposed that for compensation payments made before or after 26 November 2025, and to gifts made on or after 4 December 2025:

  • Legislation will be updated so that payments made under the Infected Blood Compensation Scheme and Infected Blood Interim Compensation Payment Scheme are relieved from IHT in cases where the original infected or affected person eligible for compensation has died before the compensation is paid.
  • First living recipients of compensation payments will also have two years in which to gift some or all of the compensation payment without an IHT charge. 

IHT treatment of unused pension funds and death benefits

It is proposed that from 6 April 2027:

  • Personal representatives will be able to direct pension scheme administrators to withhold 50% of taxable benefits for up to 15 months and pay IHT due in certain circumstances.
  • Personal representatives will be discharged from a liability for payment of IHT on pensions discovered after they have received clearance from HMRC. 

IHT: Anti-avoidance

For trust exit charges from 26 November 2025, gifts to charities in lifetime from 26 November 2025 or on a death from 6 April 2026, and for UK agricultural property from 6 April 2026:

  • The Government will legislate to prevent IHT avoidance through certain loopholes, including ensuring UK agricultural property held via non-UK entities is treated as UK-situated, addressing changes in status of trust assets before an exit charge, and restricting charity exemptions to direct gifts to UK charities and clubs.

See: Inheritance Tax: Autumn Budget 2025

Land & Property

High Value Council Tax Surcharge ('Mansion Tax')

It is proposed that from 1 April 2028: 

  • The High Value Council Tax Surcharge (HVCTS) will apply a new annual charge on owners of residential properties in England valued at £2 million and above.
  • The charge will be based on a targeted revaluation exercise carried out by the Valuation Office on the basis of property values in 2026.
  • It will apply in addition to existing Council Tax, being collected by local authorities.
  • The Government will consult on the implementation of HVCTS in the new year.

Annual Tax on Enveloped Dwellings (ATED): Out-of-time claims to relief

  • The ATED legislation will be updated to reflect the policy intent that relief from ATED is available to companies holding property for qualifying commercial purposes.
  • This includes relief claims within late ATED returns, which remain subject to robust late filing penalties.

Local Government Pension Scheme Reform: Stamp Duty Land Tax relief 

  • The Stamp Duty Land Tax rules will be amended so property transferred within Local Government Pension Schemes are subject to an SDLT relief. This will be legislated in Finance Bill 2026-27.

Landfill Tax

It is proposed that from 1 April 2026:

  • The standard rate of Landfill Tax will increase in line with RPI to £130.75 per tonne. 
  • The lower rate of Landfill Tax will increase to £8.65 per tonne. 

See: Land & Property: Autumn Budget 2025

Large Corporates

Advance Tax Certainty Service

It is proposed that: 

  • A new service to provide major investment projects with advance tax certainty will be legislated in Finance Bill 2025-26 and launched in July 2026.
  • Details of the service are set out in a summary of responses to consultation, with technical guidance to be released shortly.

Non-derecognition liabilities: anti-avoidance rule 

From 26 November 2025: 

  • A new anti-avoidance provision will be introduced, denying tax relief in respect of certain ‘non-derecognition liabilities’, where there are arrangements with a main purpose of obtaining a tax advantage.

Transfer Pricing: International Controlled Transactions Schedule

It is proposed that for accounting periods beginning on or after 1 January 2027: 

  • In-scope multinationals will be required to file an International Controlled Transactions Schedule (ICTS) with HMRC on an annual basis.
  • Technical consultation will take place in spring 2026.

Reform of UK law in relation to transfer pricing, permanent establishment and Diverted Profits Tax

It is proposed that for chargeable periods beginning on or after 1 January 2026:

  • The Government will legislate to simplify taxation of related party transactions, non-resident companies trading in the UK, and profits diverted from the UK.

Corporate Interest Restriction (CIR): reporting companies

It is proposed that:

  • Legislation will simplify administration in relation to reporting companies under CIR. Most of the changes take effect for periods ending on or after 31 March 2026.

Corporate Interest Restriction (CIR): relief for certain capital expenditure in calculation of tax-EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation)

It is proposed that for periods ending on or after 31 December 2021:

  • Legislation will make technical amendments to CIR in respect of relief for certain capital expenditure. 

Pillar 2 Multinational Top-up Tax and Domestic Top-up Tax amendments

  • Technical amendments to the Multinational Top-up Tax and Domestic Top-up Tax legislation will be included in Finance Bill 2025-26 to incorporate the latest published international updates and following stakeholder consultation.

Controlled foreign companies: treatment of interest on reversal of State aid recovery

  • Legislation for the payment of interest on amounts collected from taxpayers and now repayable following a successful challenge of a European Commission Decision will be laid.

Qualifying Asset Holding Companies (QAHC) regime

  • The Government will work with industry stakeholders over the coming months to explore targeted legislative changes aimed at ensuring the QAHC regime continues to operate effectively. Any legislative changes will be introduced in a future Finance Bill

See: Large Corporates: Autumn Budget 2025

Overseas & Residence

Non-resident dividend tax credit

It is proposed that from 6 April 2026:

  • The dividend tax credit for non-UK residents with UK income will be abolished, aligning their treatment with UK residents. 

Temporary non-residents: post-departure trade profits

It is proposed that from 6 April 2026: 

  • Legislation will remove the post-departure trade profits provisions from the temporary non-residence anti-avoidance legislation so that all dividends received during a period of temporary non-residence are chargeable to UK tax.

Excluded property trusts: IHT cap

It is proposed that (retrospectively) from 6 April 2025:

  • A £5 million cap will apply to relevant property IHT charges for trusts settled by formerly non-domiciled individuals which held excluded property at 30 October 2024. 

Offshore Anti-Avoidance

  • The Government is committing to reform and substantial simplification of the Personal Tax Offshore Anti-Avoidance Legislation and has set out the next steps for the Personal Tax Offshore Anti Avoidance Call for Evidence.

Technical amendments to residence-based tax regime

It is proposed that:

  • Legislation will make minor corrections to the residence-based tax regime introduced in Finance Act 2025.
  •  This will be legislated for in Finance Bill 2025-26 and will have retrospective effect from 6 April 2025. There are some provisions which will take effect from date of announcement, date of Royal Assent and 6 April 2026.

Aligning PAYE notifications with the Overseas Workday Relief 30% limit

It is proposed that from 6 April 2026: 

  • The proportion of earnings an employer can exclude from PAYE through a PAYE notification will be limited to a maximum 30% where the individual is a qualifying new resident and eligible for Overseas Workday Relief. 

Voluntary NICs abroad

It is proposed that from 6 April 2026: 

  • The Government will remove access to pay voluntary Class 2 NICs abroad and increase the initial residency or contributions requirement to pay voluntary NICs outside of the UK from 3 to 10 years.
  • The Government will also launch a wider review of voluntary NICs with a call for evidence in the new year.

See: Overseas & Residence: Autumn Budget 2025

Stamp Taxes

UK Listing Relief: Stamp Duty Reserve Tax relief

From 27 November 2025: 

  • A relief from the 0.5% Stamp Duty Reserve Tax (SDRT) charge will apply for transfers of a company’s securities for three years from the point the company lists on a UK regulated market. 

Modernisation of the Stamp Taxes on Shares framework

  • The Government will legislate in Finance Bill 2025-26 to introduce a power allowing regulations that enable the testing of the new digital service for the Securities Transfer Charge, which will replace Stamp Duty and Stamp Duty Reserve Tax as part of the modernisation of the Stamp Taxes on Shares framework.

See: Stamp Taxes: Autumn Budget 2025

VAT

Tour Operators' Margin Scheme (TOMS): Private Hire Vehicles (PHVs)

It is proposed that from 2 January 2026: 

  • Suppliers of private hire and taxi journeys will be excluded from the VAT Tour Operators Margin Scheme, unless those journeys are supplied in conjunction with certain other travel services.

Relief for business donations of goods to charity

It is proposed that from 1 April 2026: 

  • A relief will apply to the VAT due on business donations of goods to charity for onward distribution or use in their services.
    • The relief will apply to goods valued under £100, with a second-tier limit of £200 for a set list of items usually valued over the £100 limit, but which play an important role in tackling poverty.
  • The relief will only apply to donations made to registered charities and Charitable Incorporated Organisations (CIOs) and will be administered in an approach consistent with existing practices for donations.

Motability Scheme

It is proposed that from 1 July 2026:

  • Vehicles leased through the Motability Scheme, or any equivalent qualifying schemes, will be subject to 20% VAT on top-up payments which are made in addition to the transfer of eligible welfare payments for more expensive vehicles on the scheme. The current VAT zero-rate relief will be removed.

E-invoicing 

It is proposed that from April 2029:

  • All VAT invoices will be required to be issued in a specified electronic format.
  • The Government will work with stakeholders to develop an implementation roadmap to be published at Budget 2026.

Cross-border VAT grouping

From 26 November 2025: 

  • The conditions attached to cross-border VAT grouping for VAT group members in certain EU member states will be removed.
  • This means multiple businesses under shared control with a UK presence can be treated as a single entity for VAT purposes, regardless of the location of the overseas businesses.

VAT treatment of land intended for social housing

  • The Government will shortly consult on the reform of VAT rules to incentivise the development of land intended for social housing.

VAT and Deposit Return Schemes (DRS)

  • The Government will simplify the administration of the DRS by removing the requirement for individual producers to account for VAT on unreturned deposits. Instead, this will be done by the Deposit Management Organisation.

See: VAT: Autumn Budget 2025

Other taxes, levies, & duties etc.

Electric Vehicle Excise Duty (eVED)

It is proposed that from 1 April 2028: 

  • A new electric Vehicle Excise Duty (eVED), a mileage charge, will be introduced for battery and plug-in hybrid electric cars.
  • Rates for eVED will be set at around half the amount paid by the average petrol/diesel driver via fuel duty.
  • Drivers will pay for their mileage on a per-mile basis alongside their existing Vehicle Excise Duty.
  • A consultation has been published which provides further detail on how eVED will work and seeks views on its implementation. The consultation will remain open until 18 March 2026.

Vehicle Excise Duty for cars, vans and motorcycles

It is proposed that from 1 April 2026: 

  • Vehicle Excise Duty rates for cars, vans and motorcycles will be uprated in line with RPI.

Vehicle Excise Duty for Heavy Goods Vehicles (HGVs) and the HGV levy

It is proposed that from 1 April 2026: 

  • Vehicle Excise Duty for HGVs will be uprated in line with the RPI. The HGV levy will also be uprated in line with the RPI.

Expensive Car Supplement threshold for zero-emission vehicles

It is proposed that from 1 April 2026: 

  • The Vehicle Excise Duty Expensive Car Supplement threshold will increase to £50,000 for zero-emission vehicles only, for vehicles registered from 1 April 2025 onwards.  

Soft Drinks Industry Levy (SDIL)

It is proposed that from 1 January 2028:

  • The lower threshold at which SDIL applies will reduce from 5g of total sugars per 100ml to 4.5g of total sugars per 100ml.
  • The exemptions for milk-based drinks with added sugar and milk substitute drinks with added sugar will be removed.
    • A ‘lactose allowance’ will be introduced to account for naturally occurring sugars in milk.
    • Milk substitute drinks without added sugar will remain outside the scope of SDIL. 
  • Open cup beverages, such as those bought in cafes, will remain unaffected.
  • These proposals are contained in the outcome of the 'Strengthening the Soft Drinks Industry Levy' consultation, which was published on 25 November 2025. 
  • A technical consultation on the draft legislation will be published in 2026. 

SDIL: uprating

It is proposed that from 1 April 2026: 

  • The SDIL will be increased in line with Consumer Price Index plus one fifth of the ‘catch-up’ increment to reflect the 27% CPI increase between 2018 and 2024.

Customs treatment of low-value imports

It is proposed that from 1 March 2029: 

  • The customs duty relief on goods imported into the UK valued at £135 or below will be removed.
  • A new set of customs arrangements will be introduced for such goods under which sellers and online marketplaces will be responsible for paying the customs duty.

Economic Crime (Anti Money Laundering) Levy

It is proposed that from 1 April 2026:

  • The structure of the Economic Crime (Anti Money Laundering) Levy will change, and rates will increase.  
    • Previously, businesses were categorised as medium, large, and very large using their UK revenue.
  • The former large band, covering businesses with annual revenue between £36m and £1bn, is being split into two bands, B & C (£36m-£500m and £500m-£1bn).
  • The payments for bands A (revenues between £10.2m-£36m), B (£36m-£500m), C (£500m-£1bn), and D (above £1bn) will be £10,200, £36,000, £500,000, and £1m respectively.

Gambling Duty

It is proposed that from: 

  • 1 April 2026: Bingo Duty will be abolished.
  • 1 April 2026: the rate of Remote Gaming Duty (RGD) will increase from 21% to 40%.
  • 1 April 2027: a new 25% rate for General Betting Duty (GBD) will be introduced that applies to bets made remotely (excluding Self-Service Betting Terminals, spread betting, pool betting and UK horseracing).
  • A summary of responses to the consultation on the Tax Treatment of Remote Gambling has been published. The Government will not proceed with a single tax on remote betting and gaming.

Gaming Duty bands

  • The Gross Gaming Yield bandings for gaming duty will be frozen from 1 April 2026 until 31 March 2027 

Visitor Levy

  • The Government will give Mayors in England powers to raise a visitor levy on overnight accommodation, and explore the option for this power to be extended to the leaders of other strategic authorities.
  • The Government is consulting on the design of the Levy. 

Business Rates 

It is proposed that from 1 April 2026:

  • Business Rates in England will be updated to reflect changes in property values since the last revaluation in 2023. The small business multiplier will decrease from 49.9p in 2025-26 to 43.2p in 2026-27, and the standard multiplier will decrease from 55.5p to 48p.
  • A redesigned Transitional Relief scheme will be introduced to support ratepayers facing large bill increases at the revaluation.
  • A 1p supplement to the relevant tax rate will be introduced for ratepayers who do not receive Transitional Relief or the Supporting Small Business scheme to partially fund Transitional Relief.
  • Bill increases for the smallest businesses, losing some or all of their small business rates relief or rural rate relief, will be capped at the higher of £800 or the relevant transitional relief caps from 1 April 2026.
  • The 2026 Supporting Small Business scheme will be expanded to ratepayers losing their Retail, Hospitality and Leisure (RHL) relief. This will apply for three years.
  • A one-year extension of the 2023 Supporting Small Business scheme will be introduced in 2026-27. 
  • Two permanently lower business rates multipliers for eligible RHL properties with rateable values below £500,000 will be introduced. These rates will be 5p lower than the national multipliers, making the small business RHL multiplier 38.2p in 2026-27 and the standard RHL multiplier 43p in 2026-27
  • A high-value business rates multiplier for properties with rateable values of £500,000 and above will be introduced 2.8p above the national standard multiplier, making the high-value multiplier 50.8p in 2026-27.
  •  The Small Business Rates Relief (SBRR) grace period will be extended from one to three years.

Vaping Duty Stamps scheme and Vaping Products Duty

It is proposed that from 1 October 2026: 

  • A new Vaping Products Duty (VPD) will be introduced at a flat rate of £2.20 per 10ml applied to all vaping liquid.
  • All products liable for VPD must carry a duty stamp on their retail packaging. The stamp will provide a physical and digital tool to identify the product’s tax status and indicate its legitimacy.
    • From 1 October 2026, all vaping products must be stamped before they are released for retail sale.
  • From 1 April 2027, any product displayed or sold without a duty stamp is liable to hire seizure and penalties.

Plastic Packaging Tax (PPT) rate

It is proposed that from April 2026: 

  • The PPT rate will increase in line with CPI inflation.

PPT: Mechanically recycled plastic and certification consultation

  • The Government will consult in early 2026 on the introduction of mandatory certification for mechanically recycled plastic packaging for businesses to claim an exemption from PPT.

PPT: Mass balance approach

It is proposed that from 1 April 2027: 

  • Legislation will allow for a mass balance approach to be used to attribute chemically recycled plastic for the purposes of the Plastic Packaging Tax. The legislation will also remove pre-consumer waste as a source of recycled content from the same date

Fuel Duty

It is proposed that from April 2026:

  • The temporary 5p fuel duty cut will be extended for a further five months to 31 August 2026, with the cut being reversed in three stages: 1p on 1 September 2026, 2p on 1 December 2026 and 2p on 1 March 2027.
  • The planned inflation increase for 2026-27 will not take place. Fuel Duty rates will be uprated by the Retail Prices Index (RPI) from April 2027.

Duty-free allowances

It is proposed that from October 2026:

  • A duty-free allowance of 50ml per passenger for vaping products will be introduced, alongside moving cider and sparkling wine into the beer and still wine duty-free categories, respectively.

Response to the consultation on reforms to Landfill Tax

  • The Government will not proceed with transitioning to a single rate of tax by 2030 and will retain the exemption for quarries with disposal permits.
  • A summary of responses has been published that sets out decisions on all the proposals included in the consultation

Air Passenger Duty

It is proposed that from 1 April 2027:

  • All rates of Air Passenger Duty will be increased in line with RPI.
  • The higher rate of Air Passenger Duty will be expanded to bring into scope private jets with a maximum take-off weight between 5.7 and 20 tonnes.

Tobacco Duty Rates

From 6pm on 26 November 2025: 

  • Duty rates on all tobacco products will increase by RPI inflation +2%. 
  • A one-off increase of £2.20 per 100 cigarettes or 50g of other tobacco products and an annual uprating of tobacco duty by RPI + 2 % next year will take effect from 1 October 2026.

Alcohol Duty rates

It is proposed that from 1 February 2026:

  • All Alcohol Duty rates will increase in line with RPI inflation.
  • The Small Producer Relief discounts will also be uprated so eligible small producers receive relative duty reductions as now. 

International Student Levy (ISL)

It is proposed that from August 2028: 

  • A new levy on international students, of £925 per student per year of study, will apply.
  • All providers will be given an allowance for the first 220 international students, for whom they will not pay the ISL charge.

Climate Change Levy (CCL)

It is proposed that from 1 April 2027: 

  • The main rates of CCL for gas, electricity and solid fuels will be uprated in line with RPI.
  • The main rate for liquefied petroleum gas will continue to be frozen.
  • The reduced rates will remain at an unchanged fixed percentage of the main rates

CCL: treatment of electrolytic hydrogen in CCL and the changing energy landscape consultation response

  • Following a consultation at Spring Statement 2025, both electricity used in electrolysis to produce hydrogen and natural gas used as a source of CO2 in the production of sodium bicarbonate will be made exempt from CCL.
  • Subject to parliamentary approval, these amendments will be in force by Spring 2026.

External links

HM Treasury: Autumn Budget 2025

Office for Budget Responsibility: Economic and fiscal outlook – November 2025