What were the main points from the Autumn Budget 2025?

Several things emerged from the latest Budget which may result in change to certain areas of taxation.

An extension on the freeze on Income Tax thresholds until April 2031 will likely see more people pay more tax as their wages increase further into a tax bracket, even pushing them into the next one. This increase could be two-fold if you are using salary sacrifice to pay into your pension as a way of reducing your tax bill, because from April 2029, salary sacrificed pension contributions above £2,000 will attract National Insurance (NI) payments, which could offset the income tax saving.

If you are already of pension age, then the new ISA rules might favour you. The £20,000 annual investment allowance into an ISA remains, however, from April 2027, only £12,000 can be held in cash ISAs, while the remaining £8,000 must go into stocks and shares ISAs – unless you are over 65, in which case, the full £20,000 allowance in cash remains.

There were also a couple of changes to property taxes - and we go into more detail about Agricultural and Business Property Relief below.

Firstly, a new council tax surcharge will come into effect from April 2028. Properties worth more than £2m will pay an additional £2,500 per year, while properties worth more than £5m will pay an extra £7,500 per year.

There will also be a rise in tax rates on property income. The Chancellor announced a separate set of tax rules for anyone making money from property rental. These rates will be 2 percentage-points higher than the general income tax scale – so landlords and investors will pay higher tax rates on any rental from that date.

The rate will depend on whether or not you are a basic or higher rate tax payer, but from April 2027 the new property income bands will be 22% for basic rate tax payers, 42% for higher rate and 47% for additional rate.

Plus, as the Inheritance Tax (IHT) threshold remains frozen at £350,000 until 2031, more estates could become subject to IHT as property values increase. Planning early rather than acting under pressure will be crucial. Contact us to see if we can help.