Today, Rachel Reeves delivered her second Budget as Chancellor. With a huge fiscal gap to overcome, Reeves’ position was anything but enviable this morning. And after raising taxes by £26bn, you can decide where she stands as the sun sets on one of the most anticipated Budgets in recent times.
Below, we’ve compiled the key headlines from the Chancellor’s Autumn Budget 2025 announcements for anyone who wasn’t online at 11:45am this morning for the OBR’s whoopsie.
Take a read. Then, keep your eyes peeled for our full Budget breakdown, coming in hot tomorrow.
AUTUMN BUDGET 2025: KEY CHANGES FOR BUSINESSES
- Pension salary sacrifice – Contributions to be capped at £2,000 a year (before NI) from April 2029. Contributions above this threshold will be subject to employer and employee NICs.
- Online gaming and betting levy – Remote gaming duty increased from 21% to 40%. Levy on online sports betting increased from 15% to 25%. New remote betting rate at 25% from April 2027.
- Enterprise Management Incentive (EMI) schemes – Employee limit doubled to 500, gross asset limit quadrupled to £120m and company share option limit doubled to £6m. The requirement to file EMI notifications is being removed from April 2027 and the maximum holding period of an EMI option will increase from 10 to 15 years. All in all, fantastic news for many companies out there that already have an EMI scheme or may have previously missed out.
- VCT & EIS – Annual investment limits doubled to £10m and £20m for Knowledge Intensive Companies (KICs), i.e., those undertaking significant R&D. The EIS lifetime limits for amounts raised have also doubled to £24m and £40m respectively for KICs. The upfront income tax relief for those investing in VCTs will reduce to 20%.
- Customs Duty Relief – Abolished for goods under £150 from March 2029.
- VAT – No increase on VAT registration thresholds (£90,000) until at least March 2026. No increase to standard VAT rate, honouring the government’s manifesto promise. Stricter approach late VAT payment penalties, increased penalties from April 2027. Private hire vehicles exit TOMS (Tour Operators’ Margin Scheme) from January 2026 and VAT applicable on PHV fares. From July 2026, for some more expensive vehicles, top up payments on Motability leases will be subject to 20% VAT. IPT will also be applied at 12% for insurance relating to vehicles leased through the scheme.
- Capital Allowances – Writing down allowance main rate reduced from 18% to 14% from April 2026. 40% first-year allowance introduced from January 2026.
- Stamp Duty Reserve Tax (SDRT) – ‘Listing relief’ introduced, offering a 3 year exemption from SDRT for companies that list in the UK.
- Northern Ireland – While Northern Ireland will receive £240m extra for day-to-day spending and £130m for capital projects, this falls short of the current £400m overspend. £16.6m over three years will help businesses navigate Brexit and the Windsor Framework, including support for trade between NI and GB. There’s also a focus on advanced manufacturing through the Enhanced Investment Zone.
- Scotland – The Scottish energy sector suffered a setback as there was no removal or amendment to the Energy Profits Levy (EPL). This will be a huge blow to the sector which had campaigned to reduce the punitive rate of tax to enable investment.
AUTUMN BUDGET 2025: KEY CHANGES FOR INDIVIDUALS
- Income tax thresholds – Freeze extended on the income tax personal allowance, higher and additional rate thresholds and NI thresholds from April 2028 until April 2031, moving more people into higher tax brackets as their pay increases.
- Income tax rates – The basic and higher rates of tax on dividend income will increase by 2% from April 2026. There is no change to the dividend additional rate. From April 2027, the property income basic rate will increase by 2% to 22%, the higher rate will be 42%, and the additional rate will be 47%. The tax rate on savings income will increase by 2% across all bands from April 2027.
- Pensions – £2,000 cap on pension contributions made under a salary sacrifice scheme from April 2029. Contributions above this amount will be subject to NI.
- Employee Ownership Trusts (EOTs) – CGT relief reduced from 100% to 50%.
- Council tax surcharge – Applied to homes worth >£2m from April 2028.
- Cash ISA allowance – From April 2027, this will be cut from £20,000 to £12,000 for those under the age of 65. Individuals over the age of 65 will keep the current £20,000 allowance.
- Fuel duty rates – Frozen until September 2026.
- Electric vehicle duty – From April 2028, EVs and plug-in hybrids face a pay-per-mile charge. Consultation open until March 2026, but it’s expected to be ~3p/mile.
- Inheritance Tax (IHT) – The government will legislate to prevent IHT avoidance through certain loopholes, including ensuring UK agricultural property held via non-UK entities is treated as UK-situated. This will take effect for trust exit charges from 26 November 2025 and for UK agricultural property from 6 April 2026. The government will also introduce a cap of £5m on relevant property trust charges for pre-30 October 2024 excluded property trusts with immediate effect.
- APR & BPR – £1m allowance for the 100% rate of agricultural property relief (APR) and business property relief (BPR) frozen until 2031. Any unused 100% allowance (up to £1m) will be transferable to a spouse or civil partner, including if the first death was pre 6 April 2026.
- Capital Gains Tax (CGT) – The government will modernise the anti-avoidance provisions that apply to share exchanges and company reorganisations. Non-resident CGT rules will also be amended, closing loopholes for protected cell companies and clarifying legislation for investors.
Keep an eye out for our full Budget breakdown, landing tomorrow.
In the meantime, if you have any questions about how these changes may affect your business or personal finances, don’t hesitate to reach out.
