Autumn Budget 2025 – at a glance To discuss the Autumn Budget and planning ahead, email enquiries@om.uk or speak to your usual Old Mill contact.
Individual
Mansion Tax
Economy
Income Tax (IT)
A high value Council Tax surcharge on properties worth over £2m will be introduced from April 2028.
Inflation
Income Tax and National Insurance thresholds will continue to be frozen for a further 3 years from 2028. Dividend rates changing from April 2026: • Basic rate: 8.75% to 10.75%, • Higher rate: 33.75% to 35.75% • Additional rate will remain unchanged at 39.35% Savings rate changing from April 2027: • Basic rate: 20% to 22%, • Higher rate: 40% to 42%, • Additional rate: 45% to 47% From April 2027, there will be a separate rate of tax for property income. These will be the same as the new savings rates. National Insurance From 6 April 2026, individuals will no longer be able to pay national insurance for periods abroad. Pensions From 2029, National Insurance (employee and employer) will be charged on salary sacrifice into pensions above an annual £2,000 threshold. April 2026 – State Pension will increase by 4.8%. Minimum wage Minimum wage increasing from £12.21 to £12.71 per hour. National Minimum Wage for 18 to 20year-olds will increase from £10 to £10.85 per hour – working towards a single adult rate. Investment Savings Accounts (ISA) The £20,000 ISA allowance is to remain the same with the cash ISA allowance to be reduced to £12,000 for under 65s.
Houses worth £2m will see a charge of £2.5k per annum, increasing to £7.5k for houses worth over £5m.
The Office for Budget Responsibility forecasts inflation to average 3.5% in 2025, decreasing to 2.5% in 2026 and returning to the government's 2% target in 2027.
Two Child Benefit Cap
Duties
The two child benefit cap will be abolished from April 2026.
Fuel Duty
Inheritance Tax (IHT) The new £1 million Agricultural Property Relief (APR) and Business Property Relief (BPR) allowance, coming into force from April 2026, can be transferred between spouses.
Business Capital Allowances A 40% First Year Allowance (FYA) will be introduced from 1 January 2026 for main pool expenditure, on top of existing allowances such as Annual Investment Allowance and Full Expensing (the latter applying to companies only). Reduction to the main pool Writing Down Allowance (WDA) from 18% to 14% from April 2026. Share Schemes The Enterprise Management Incentive scheme eligibility limits have been vastly expanded to allow more companies to offer the taxadvantaged scheme to their employees. Capital Gains Tax (CGT)
Fuel Duty to remain frozen at current levels until September 2026. Gambling Duty Increasing remote Gaming Duty from 21% to 40%. Duty on online betting will increase from 15% to 25% and Bingo Duty will be abolished.
Stamp Duty Reserve Tax A three year Stamp Duty exemption will apply for companies newly listing on a UK regulated market.
Other points Mileage-based charge A new mileage-based charge on battery electric and plug-in hybrid cars from April 2028 at 3p per mile for electric cars and 1.5p for hybrid. Sugar Tax Tax on sugary drinks expanding to cover pre-packaged milkshakes and coffees. Apprenticeships Training for under 25s through apprenticeships will be made free for small and medium-sized enterprises.
Reduced CGT relief on disposals to Employee Ownership Trusts (EOTs) from 100% to 50%, effective from 26 November 2025. Investment Schemes The Enterprise Investment Scheme and Venture Capital Trusts schemes will have investment limits increased, but VCT income tax relief reducing to 20% from April 2026.
All details are correct at the date of publishing. This publication is for guidance only. It is important for you to take individual advice before taking any action. Old Mill is a trading name of Old Mill Accountancy Limited. Registered in England Number 13566765. Regulated by the Institute of Chartered Accountants in England and Wales for a range of investment business activities. Registered office Maltravers House, Petters Way, Yeovil, Somerset, BA20 1SH