Our full summary document is now available.
After months of endless speculation, the Chancellor of the Exchequer Rachel Reeves delivered her second Autumn Budget on 26 November 2025. These delivered up to £26 billion of tax rises through a range of measures, though principally by extending the freeze on Income Tax thresholds for a further three years and future increased tax rates for property, dividend and saving income.
The Budget also announced employee and employer National Insurance contributions (NICs) on salary sacrifice pension contributions above £2,000 a year and introduced a ‘mansion’ tax on homes valued at £2 million or more.
On the cost of living, the Chancellor took action to cut energy bills, freeze rail fares and end the two-child benefit cap. In her own words, ‘I can tell you today that, for every family we are keeping our promise to get energy bills down and cut the cost of living with £150 taken off the average household energy bill from April.’ ‘Money off bills, and in the pockets of working people. That is my choice.’
With a Summer and Autumn of speculation, this Budget may well end up being judged by what was not included but may remain on the table. There was no general wealth tax, though we will have a “mansion” tax, no widespread capital gains increase, but a small increase where Business Asset Disposal Relief has been claimed, and no exit tax for departing taxpayers. Most importantly, there was no general increase to income tax rates and reductions in thresholds that was feared.
The acid test will be how the Budget is received in the bond markets with some 10% of Government expenditure on servicing the interest on the national debt. Securing a lower interest rate and paying down on the national debt will provide the Chancellor with some flexibility before the next election in 2029.
And what of growth? There are some small nuggets of targeted assistance, particularly around more generous EMI scheme limits and some business rate relief changes, though overall this Budget was light on pro-growth content. For angel investors, the reduction of the income tax relief on EIS qualifying investment from 30% to 20% will be an irritant than a gamechanger.
On reflection, this Budget, as hyped up as it was and with the OBR report being released early, ended up being a more low-key affair. The Chancellor will hope that more radical intervention will not be required, though time will tell and sentiment can quickly shift. For clients waiting for the result of the Budget before looking to plan, be it to expand their business, sell their business or undertake some estate planning, the time may be now and we remain ready to guide you through this process.
