Autumn Budget 2025: Key highlights

Chancellor Rachel Reeves delivered her second UK Budget promising ‘no return to austerity or reckless borrowing’.

Here’s a summary of the key changes announced:

Personal tax

• National Insurance (NI) and income tax thresholds have been frozen until 2031.
• The basic and higher income tax rates on property, savings and dividend income will increase by 2%.
  • From April 2026 the basic rate of dividend tax will increase from 8.75% to 10.75% and the higher rate will increase from 33.75% to 35.75% (there is no change to the dividend additional rate of 39.35%.)
  • From April 2027, the basic rate of tax on savings income will increase from 20% to 22%, the higher rate from 40% to 42% and the additional rate from 45% to 47%.
  • A separate tax rate for property income will be introduced from April 2027. The property basic rate will be 22%, the property higher rate will be 42% and the property additional rate will be 47%.
• A new ‘mansion tax’ has been introduced in England.  The new High Value Council Tax Surcharge (HVCTS) will be £2,500 per year for homes worth over £2 million and £7,500 for homes worth over £5 million and is addition to existing Council Tax.  This will be levied at property owners, not occupiers.

Inheritance tax

• A change will be introduced to allow the transfer of the 100% combined Agricultural Property Relief and Business Property Relief on death to the surviving spouse when the £1m cap is introduced from 6 April 2026.

ISA reform

• ISA Reform: From 6 April 2027 the annual ISA cash limit will be £12,000 within the overall annual ISA Limit of £20,000 for savers under the age of 65. The remainder will be reserved for investments (i.e. a stocks and shares ISA).  Savers over 65 will continue to benefit from a full £20,000 of cash ISA allowance.

Pensions

• The amount that people can pay into their pension pot under salary sacrifice schemes without paying National Insurance will be capped at £2,000 from April 2029.

Business taxes

• The Capital Gains Tax (CGT) relief on qualifying disposals to Employee Ownership Trusts (EOTs) will be reduced from 100% of the gain to 50% for disposals on or after 26 November 2025.
• Capital allowances: the first year 100% allowances for zero emission vehicles (ZEVs) and charge points have been extended for a further 12 months until April 2027.  The Main Pool Writing Down Allowance (WDA) is to be reduced from 18% down to 14% from April 2026, while there will also be a new 40% first-year allowance from January 2026.
• The eligibility criteria for Enterprise Management Incentives (EMIs) has been extended to companies with up to 500 employees and assets of £120 million or less from April 2026.
• Remote gaming duty (RGD), levied on online casinos will increase from 21% to 40% from April 2026. The online betting tax will rise from 15% to 25%. The bingo tax is being abolished.

Business rates

• Business rates: two new permanently lower business rate multipliers will be introduced for retail, hospitality and leisure (RHL) businesses with rateable values below £500,000 from April 2026. These will be 5p lower than the national multipliers.
• 100% business rates relief for eligible electric vehicle charging points and electric vehicle only forecourts

National Minimum Wage

• The National Minimum Wage for 18-20 year olds will increase from £10 to £10.85 per hour from April 2026. The National Living Wage will increase from £12.21 to £12.71.
• The minimum wage for 16 and 17 year olds and the apprentice rate will increase from £7.55 an hour to £8 per hour.

Electric Vehicle Excise Duty

• A new Electric Vehicle Excise Duty (eVED) of 3p per mile for electric cars and 1.5p per mile for plug-in hybrids will be introduced from April 2028 in addition to their existing Vehicle Excise Duty.

Fuel duty

• Fuel duty has been frozen until the end of August 2026

Stamp Duty Reserve Tax

• Stamp duty reserve tax: a three year stamp duty reserve tax break has been introduced for companies newly listing on the London Stock Exchange

Other taxes

• “Milkshake tax” – dairy-based drinks are being added to the existing sugar tax.

For further advice about how the changes announced in the Budget will affect you, please contact your local Moore adviser.