Autumn Budget 2025 - everything you need to know

Earlier today, Chancellor Rachel Reeves delivered the Autumn Budget, outlining a number of tax and financial changes over the next few years. We have summarised the key points below to help you understand what is changing and when...

Personal tax thresholds

The freeze on personal income tax thresholds has been extended for a further three years. Thresholds will remain fixed until the start of the 2030/31 tax year. The thresholds are...

• Basic rate threshold - £0 to £50,270

• Higher rate threshold - £50,271 to £125,140

• Additional rate threshold - £125,140+

Tax increases on dividends

From April 2026, tax on dividend income will rise by 2% for basic and higher rate taxpayers, meaning that the rates will now be...

Basic rate - 10.75%

Higher rate - 35.75%

Additional rate - stays at 39.35 percent

Tax increases on rental and interest income

From April 2027, tax on rental income and savings interest will increase by 2% for all taxpayers, regardless of income band.

ISA reforms

The annual ISA allowance remains £20,000. However, from April 2027, £8,000 of the allowance must be placed into an investment ISA, leaving £12,000 available for a cash ISA.People aged 65 or over will still be able to put the full £20,000 into a cash ISA.

Child benefit

The two-child benefit cap will be removed from April 2026. This means families will be able to claim child benefit for more than two children.

Mansions tax

From April 2028, an additional annual council tax charge will apply to properties valued above £2 million:

• £2 million or more - extra £2,500 per year

• £5 million or more - extra £7,500 per year

Corporation tax

There are no changes to corporation tax rates.

VAT

There are no changes to the VAT registration threshold and no planned increases to the VAT rate.

If you have any questions or would like to discuss how these changes may affect you, please feel free to reach out. We are here to help.