A quick and practical overview of the key Autumn Budget 2025 announcements and how they may affect you, your family and your business.
1. Dividend Tax Increases from April 2026
Dividend tax rates will rise by 2 percentage points.
This will affect:
• Company directors
• Shareholders who take dividends
• Family-run companies
If you take a low salary and high dividends, your personal tax bill will increase. It is worth reviewing how you extract income from your company ahead of April 2026.
2. Income Tax and NI Thresholds Frozen Until 2031
All main personal tax and National Insurance thresholds will remain frozen until April 2031.
This means you may pay more tax over time, even if your pay rise only matches inflation.
Impacts:
• More people pushed into higher tax bands
• Reduced take home pay
• Higher long term employment costs for businesses
3. New High Value Property Charge from 2028
A new annual council tax charge will apply to homes valued above £2 million.
Charges:
• Properties £2 million to £2.5 million: £2,500 per year
• Properties above £5 million: £7,500 per year
This affects both homeowners and property investors. Consider building this into long term planning.
4. Changes That May Help Households
Removal of the two child benefit cap
From April 2026, benefit payments will no longer be restricted to two children.
Lower energy bills
A typical household may save around £150 per year from April 2026 due to changes in renewables obligations.
Increased public spending
Government spending is set to be around £32 billion higher per year by 2029 to support services such as schools, hospitals and local infrastructure.
5. Business and Employer Considerations
Company cars
Incentives for electric and zero-emission vehicles remain in place. If you are updating your fleet, there are still tax advantages.
Pension salary sacrifice
From April 2029, only the first £2,000 of salary sacrifice pension contributions will be exempt from NICs.
Capital allowances and investment reliefs
Some allowances may tighten. If you are planning to invest in new equipment or assets, it is worth reviewing the timing.
6. Economic Forecast Highlights
According to the Office for Budget Responsibility (OBR):
• GDP growth expected at around 1.4 to 1.5 percent annually
• Inflation staying above target in the near term
• Household incomes only slightly higher by 2031 compared with pre pandemic levels
• Productivity growth remains weak
This economic backdrop reinforces the importance of cash flow planning and efficient tax strategies.
7. What You Should Do Now
For individuals and families:
• Review your income position under frozen thresholds
• Consider the impact of rising dividend tax if you hold shares
• Plan ahead if you own high value property
For business owners and directors:
• Revisit your salary and dividend mix
• Update forecasts for 2026 onward
• Check whether company benefits remain tax efficient
• Review investment plans for plant, machinery and vehicles
Need Help Understanding What This Means for You?
We support clients across Stevenage and Hertfordshire with clear, practical tax advice. If you would like a personalised review of how the Autumn Budget affects you or your company, we are here to guide you step by step.
Get in touch to discuss your next steps.
Want to know more?
You can contact Hammond-Barr accountants on 01438 281281 or via email at [email protected].
Share this post: