Autumn Budget 2025
- sallystubbs68
- 5 hours ago
- 2 min read
The Chancellor, Rachel Reeves, yesterday delivered her much anticipated and heavily leaked second Budget.
Despite pledging that she would not be ‘coming back for more’ after last year’s £40 billion tax increases, there was what has been coined a ‘smorgasbord’ of additional tax-raising measures that will generate a further £26 billion.
Inheritance Tax was largely left alone after bearing the brunt in 2024 and this time the tax increases were focused on what have been described as the ‘non-workers’ amongst us i.e. landlords, investors and savers.
The key tax measures Reeves announced were:
A freezing of the income tax thresholds until at least 2031 – this would mean these will have remained unchanged for 10 years
A 2% rise in tax on dividends from April 2026
A 2% rise in tax on property rental income from April 2027
A 2% rise in tax on interest earned from April 2027
From April 2029 there will be a £2,000 cap on relief from National Insurance Contributions for pension contributions under salary sacrifice arrangements – however, Income Tax relief will remain for contributions in excess of this cap
The 100% exemption from Capital Gains Tax (CGT) for sales of companies to Employee Ownership Trusts (EOT) has been halved to 50% with immediate effect and Business Asset Disposal Relief (BADR) will not be available to reduce the rate of CGT – this means an effective rate of CGT of 12% on a disposal to an EOT
The £1m Business Property Relief (BPR) allowance will be transferable between spouses and civil partners (when this takes effect from April 2026) – this will allow a couple to use a £2m allowance between them
The limits for eligibility for the Enterprise Management Incentive and Enterprise Investment Scheme will significantly increase from April 2026
As was heavily trailed beforehand there were several additional tax-raising measures including reductions in ISA allowances, increases to Council Tax for high-value homes and duties on Electric Vehicle drivers. There was also a further increase to both the National Minimum Wage and National Living Wage.
To view our detailed summary please click the link below
Please click below to see our detailed summary.
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