It’s easy to feel overwhelmed by all the numbers, facts, and figures in the Autumn Budget and just tune out. But those numbers aren’t just abstract - they shape your life, your plans for the future, and your family’s financial security.
We often find that the Budget sparks some of the most important and interesting conversations with clients. This blog, from Managing Director of Financial Services, Stephanie Woodward, takes those headline changes and translates them into what really matters: how they impact you and your financial planning.
1. Taxes - the only way is up
- Dividends: If you take income from shares or your business, rates rise by 2% from April 2026 to 10.75% and 35.75% for basic and higher rate taxpayers.
- Savings Interest: From April 2027, tax on interest increases to 22%, 42%, and 47%.
- Rental Income: Landlords face higher property income tax rates with an additional 2% tax on rental income from April 2027.
- Income Tax Bands Frozen: These are going to be frozen for longer, with the biggest impact where people slide into the next tax band.
What this means for you:
There’s no avoiding the fact that more people will be paying higher taxes - whether directly on dividends, savings, or rental income, or indirectly by being pulled into higher tax bands due to the freeze.
This makes choosing the right investment wrapper - such as an ISA, pension, or investment bond - more important than ever. With the Lifetime ISA currently under consultation for potential replacement, and new limits for under-65s (up to £12,000 in a cash ISA and the remaining £8,000 in an investment ISA), decisions are becoming more complex.
On top of that, VCT investments are becoming less attractive, with income tax relief reducing from 30% to 20% from next April, even though the size of companies eligible for VCT funding is increasing. This change may alter the risk/reward balance for investors considering VCTs. These are high-risk investments though and not suitable for everyone. They should only be considered as part of a diversified portfolio and after taking advice.
Higher tax rates on savings also raise concerns that people may contribute less to cash ISAs, leaving them exposed to unnecessary tax. Careful planning is essential to make the most of available allowances and manage your tax position.
2. Passing wealth to loved ones – Inheritance Tax changes
- Nil Rate Band (£325k) and Residence Nil Rate Band (£175k) stay the same until 2031.
- Unused pensions will be included in your estate for IHT from April 2027.
- Agricultural & Business Property Relief: £1m allowance remains, now transferable between spouses from April 2026.
Why this matters:
Since the announcement last year that pensions were planned to come into your estate for IHT from 2027, IHT has been a massive topic of conversation with our clients. If you’ve worked hard to build wealth, you want it to benefit your family — not disappear in tax. With thresholds frozen and property values rising, more estates will pay IHT. There are plenty of options out there though to help reduce this liability. This is the time to review wills, consider gifting strategies, and explore trusts.
3. Your retirement – pensions and salary sacrifice
- Salary Sacrifice NI Relief will be capped at £2,000 from April 2029.
- State Pension rises by 4.8% from April 2026, bringing it close to the personal allowance.
What this means for you:
If you use salary sacrifice to boost your pension, the benefit will reduce slightly - but pensions remain an attractive way to save for retirement. For most people, the fundamentals haven’t changed: start early, contribute regularly, and review your plan as rules evolve.
With the increases to State Pension getting close to the Personal Allowance, the government says that it will ease the administrative burden for pensioners whose sole income is the basic or new state pension without any increments so that they do not have to pay small amounts of tax via simple assessment from 2027-28 if the new or basic state pension exceeds the personal allowance from that point. This would be very welcome for many.
4. What should you do now?
- Check your investment strategy: Are you making the most of your allowances, and using the best investment vehicle for your needs?
- Plan for inheritance early: Don’t wait until it’s too late - review your estate plan now.
- Maximise allowances: Use today’s ISA limits and consider appropriate investment opportunities while relief is still generous.
- Review pension contributions: Understand how salary sacrifice changes might affect you.
Your next step
These changes aren’t just about tax. They’re about your future security and your family’s wellbeing. A good financial plan adapts as the rules change. We’re here to help you make sense of it all and create a strategy that works for you.
Ready to take control?
If you’d like to understand how these changes could affect your plans, speak to one of our advisers for personalised guidance
This article is for information only and does not constitute financial advice. Tax treatment depends on individual circumstances and may change in the future.