Expat UK Tax Seminar - UK Autumn Budget 2025 at a Glance
- Expat UK Tax
- Dec 4
- 3 min read
Since Rachel Reeves announced the budget, we’ve been busier than ever answering your questions. We recently hosted two seminars to clearly explain what the Autumn Budget means for our clients and partners. If you couldn’t join us, don’t worry, just check out the brief summary below! We look forward to having you with us at the next seminar.
The UK Autumn Budget 2025 brought a mix of tax updates, policy shifts, and changes that could affect both individuals and businesses. Here are a few of the most significant changes.
Changes to Income Tax & National Insurance
Personal allowance, higher rate and National Insurance thresholds remain frozen until April 2031, pulling more people into higher tax bands over time.
Tax on income from dividend will rise by 2% from 6 April 2026 for basic and higher rate taxpayers:
Basic rate: 10.75%
Higher rate: 35.75%
Additional rate: 39.35% (no change)
Savings and property income tax rates will rise by 2% from 6 April 2027 across all bands to:
Basic rate: 22%
Higher rate: 42%
Additional rate: 47%
Pensions and Salary Sacrifice
From April 2029, if employer pension contributions through salary sacrifice are over £2,000 a year, both the employee and employer will pay NIC on the extra amount. Income tax relief is still applicable
Individual Savings Accounts (ISAs)
From April 2027, the overall £20,000 ISA allowance remains unchanged. But £8,000 will be designated for stocks and shares ISAs only, limiting cash ISAs to £12,000 for those under 65s. Over 65s retain the full £20,000 cash ISA limit.
“Mansion Tax”
From April 2028, properties worth £2 million or more will pay an annual High Value Council Tax Surcharge (HVCTS) of £2,500–£7,500, rising each year in line with inflation.
The government will review reliefs, exemptions, and support for homeowners who may struggle to pay.
Theshold
Threshold (£m) | Rate (£) |
£2.0 - 2.5 | £2,500 |
£2.5 - 3.5 | £3,500 |
£3.5 - 5.0 | £5,000 |
£5+ | £7,500 |
(£m) Rate (£)
Inheritance Tax
Nil-rate bands remain frozen until April 2031.
From April 2027, unused pension pots will be included in your estate and subject to IHT on death. Executors can ask pension providers to hold back up to 50% of the pot for up to 15 months to cover any tax.
Agricultural and business property relief capped at £1 million from April 2026 and will be transferable between spouses and civil partners.
UK agricultural property held through non-UK entities will be treated as UK property for IHT. From April 2025, former excluded property trusts will have a £5 million cap for ten-year and exit charges, only where assets remain outside the UK.
Class 2 NICs Abolished for Non-UK Residents
From 6 April 2026, non-UK residents will not be able to pay Class 2 NICs. Transitional arrangements are still being finalised.
Class 3 NICs remain available but require meeting a 10- year threshold for eligibility.
Venture Capital Trust (VCT) Relief
VCT income tax relief drops from 30% to 20%.
Annual investment limits to £10m/£20m (from £5m/ £10m) Lifetime limits to £24m/£40m (from £12m/£20m)
Temporary Non-Residents
Trading profits and dividends earned during a period of temporary non-residence will now fall outside UK tax scope, providing clarity for individuals who leave the UK for short periods.
Making Tax Digital (MTD)
From April 2026, MTD for Income Tax Self Assessment applies to self-employed individuals and landlords with income over £50,000.
From April 2027, the threshold reduces to £30,000 and from, April 2028 drops to £20,000.
Quarterly updates required, but first-year penalty relief applies for late submissions in 2026/27.
Non-residents have an extra year before MTD applies, starting April 2027.
Downloadable Summary, please click below!
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