Autumn Budget 2025: a summary of the key points

After months of speculation, the Chancellor has set out the government’s tax and spending plans, aiming to balance its growth agenda with concerns about the cost of living.

Her statement says she’s taking “fair and necessary choices to deliver on our promise of change.” The key tax announcements for individuals and businesses are summarised below.

Individuals

Income tax and National Insurance

• The income tax personal allowance, higher-rate threshold and additional-rate thresholds of £12,570, £50,270 and £125,140 respectively, and the equivalent National Insurance Contribution (NIC) thresholds, are being frozen for an extra three years until 5 April 2031. Please note that Scottish income tax bands and rates differ.
• The NICs secondary threshold of £5,000 is being frozen for an extra three years until 5 April 2031.
• Salary-sacrificed pension contributions above an annual £2,000 threshold will be chargeable to employer and employee NICs from 6 April 2029.
• Tax relief for non-reimbursed homeworking expenses will be removed from 6 April 2026.
• The rate of tax on dividend income will increase from 8.75% to 10.75% for basic rate taxpayers and from 33.75% to 35.75% for higher rate taxpayers from 6 April 2026.
• The basic, higher, and additional rates on savings UK-wide, and property income in England, Wales and Northern Ireland, will increase by two percentage points (to 22%, 42%, and 47% respectively) from 6 April 2027.
• Voluntary Class 2 NICs to be abolished for individuals living abroad.
• The dividend tax credit for non-UK residents will be abolished from 6 April 2026.
• Image rights payments related to employment are to be treated as taxable employment income, subject to income tax and employer and employee NICs with effect from 6 April 2027.
• The post departure trade profits provisions in the temporary non-residence anti-avoidance legislation will be removed from 6 April 2026.
• The rate of income tax relief on Venture Capital Trust (VCT) investments will reduce to 20% from 6 April 2026.