The Budget will take place on Wednesday 26 November 2025.

There could be more tax rises in the Autumn 2025 Budget to counter both increased government spending, a widening fiscal black hole by as much as £50bn, and sluggish economic growth to the extent that even the IMF may be asked for help.

Just servicing the government’s debt is costing over £100bn a year.

The previous Budget’s hikes in National Insurance, CGT and IHT are likely to be compounded with more taxes through stealth and also on wealth. The Chancellor has previously said that she will not raise income tax, national insurance or VAT (which are three major revenue earners for the Treasury), but that does not prevent her from widening the scope of those taxes, e.g. making older workers pay national insurance, or changing the VAT registration threshold.

The likely programme of tax rises takes place against rising inflation, increasing business costs, and interest rates that remain stubbornly high.

Having previously told the CBI business group that: “I’m really clear: I’m not coming back with more borrowing or more taxes,” that appears to be exactly what Rachel Reeves will do.

However, one factor to consider is the Prime Minister’s recent reshuffle, where he brought in to 10 Downing Street a key figure from the Treasury (who was the Chancellor’s senior adviser) and an economist, presumably to second-guess the Chancellor. How will this play out in the Budget? Is this why it is now being delayed until the end of November rather than in October as was expected? The delay prolongs the uncertainty around where tax rises will fall.

What could be announced?

Media speculation is already at fever pitch, and not just about the looming bad news on the economy and tax rises, but also about the position of the Chancellor.  There is a lot riding on the Autumn Budget.

Below, we outline the main areas where changes are likely to occur.

Stealth Income Tax via Threshold Freezes
The freeze on personal and higher-rate income tax thresholds (currently until 2028) is likely to be extended, potentially to 2030, generating around £8bn annually through “fiscal drag” as earnings are caught up in higher tax bands.

The freeze on tax thresholds continues to be a major revenue raiser.

Inheritance Tax (IHT) Reforms
Inheritance tax is expected to feature prominently in the Budget, following on from last year’s announcements that private pensions will become subject to IHT at 40% from April 2027, alongside drastic reductions in allowances for agricultural and business property.

See our previous article: Major inheritance tax changes to go ahead despite lobbying

But this Budget could go even further with such possibilities as:

• A lifetime gifting limit on how much can be passed on tax-free before death.
• Reducing or restricting the existing taper relief that discounts the rate of IHT on gifts made at least three years before death.
• Extending the freeze on the £325,000 nil-rate-band threshold to 2030.
• Restricting or reducing the £175,000 residence nil-rate band on the main home.
• All these potential announcements directly impact wealth.

Property and Wealth Taxes
Various rumours have been published in the media of potential measures being considered:

A reform or complete replacement of council tax, such as with a property tax based on value. This would be a major change to property taxes and would require a considerable amount of work to implement, and thus lead time for consultation.

There has also been the re-emergence of discussions about a mansion tax, possibly in the form of a CGT charge on homes worth over a certain value, thus limiting the existing main residence exemption.

Stamp duty, or more properly, Stamp Duty Land Tax, could be abolished or reformed.  This could take the form of making sellers liable for the tax rather than buyers. This could apply to properties over a certain value, e.g. £1m?

Another tax could be on land values rather than buildings, but the consequences of doing this are not clear other than perhaps attempting to encourage development.

The likelihood of any of the changes happening depends on how far the Chancellor is prepared to go in taxing wealth and property in the longer term rather than simply looking for a quick fix for the fiscal black hole.  The recent controversy over the Deputy Prime Minister’s stamp duty arrangements will not have helped matters for reforming property taxes, and may delay announcements to another time.

As regards the introduction of an annual wealth tax, the Chancellor has indicated that this is not currently being considered due to logistical challenges. It has been tried in a number of other countries but mainly without success in terms of raising the revenue expected.

National Insurance
Last year’s Budget significantly increased National Insurance for employers, impacting jobs, recruitment and growth. Would the Chancellor seek to raise more this way, or perhaps she sees this as too risky?

National Insurance for Landlords
As if landlords do not already feel unfairly targeted by numerous tax measures, there is now speculation that rental income could be subject to National Insurance.

How could this be applied? Would it be on rental profits, or possibly some form of alignment with employment income?

Whilst this widening of the scope of NI could bring in a couple of £bn revenue, there would also have to be measures to deal with landlords incorporating their property portfolios to avoid the NI charge.

As landlords will have to submit details of their rental income under Making Tax Digital for income tax from 2026/27, any national insurance could be ascertained that way by HMRC.

Pension Reforms
Pensions are increasingly seen as low-hanging fruit for a revenue-hungry Treasury. Whilst fundamental reforms may not be any time soon, there are changes that could result in more immediate revenue.

We already know from last year’s Budget that unused pension pots will become subject to IHT from 2027., although the details of how this will work in practise are yet to be finalised.

Reducing or removing altogether the current 25% tax-free lump sum on pension withdrawals is being considered. This may be coupled with the removal of higher-rate tax relief on pension contributions, or even a flat rate of relief. The previous government also considered the latter point a number of times, but never took any action. This could be the moment when such reforms are introduced.

Another and more controversial measure would be to remove the state pension triple lock.  A recent report estimated that the government would not be able to afford to honour the triple lock beyond the next ten years anyway, but the current government may prefer to defer any such change until after the next general election.

ISA Allowances
There is speculation that the cash ISA allowance could be cut from £20,000 to as little as £4,000 to drive more investment into UK-listed shares.

Fuel Duty
Fuel duty has now been frozen for over a decade, with a temporary 5p per litre cut still in place. Removing the freeze would push up costs for households and businesses.

VAT Threshold
There has been speculation in the media about VAT threshold changes, mainly in the context of addressing the suppression of growth in turnover for small businesses that currently take steps to limit income to stay below the £90k VAT registration threshold.

Some have speculated on a higher threshold, but there are problems with doing this as Northern Ireland remains bound by some EU VAT rules and the maximum VAT Threshold allowed in the EU is EUR100k (GBP90k), and the threshold would need to be increased significantly to make a real difference to growth.

Potentially a more likely scenario is for the chancellor to lower it down to a figure catching all but small hobby businesses, perhaps £30k. This both permanently removes the growth barrier at £90k (or a higher figure) and would bring around a million small businesses, mostly B2C, into the scope of VAT, raising significant new tax revenues, without changing “the rate of VAT”.

Other measures
On top of the above, the Chancellor is likely to announce another rise in the National Living Wage from April 2026.  There will also be significant costs for employers from the forthcoming employment regulations in the Employment Rights Bill making its way through Parliament.

A modest rise in corporation tax for banks or targeted sectors could be on the cards.

We also know that the Deputy Prime Minister Angela Rayner, has previously suggested where tax rises on businesses and individuals could bring in an extra £4bn a year. How many of her ideas, if any, will the Chancellor take on board?

Those ideas included:

• reinstating the pensions lifetime allowance
• Increasing taxes on dividends to level up with income tax rates and removing the dividends allowance
• remove inheritance tax from AIM shares
• closing commercial property stamp duty loopholes
• increasing the rates of Annual Tax on Enveloped Dwellings (ATED)
• freezing the additional rate income tax threshold beyond 2028

Contact us…
The Autumn Budget could usher in new taxes on top of those announced last year, affecting income and wealth.

If you would like to discuss how these forthcoming changes could impact you and your business, please contact the Bishop Fleming Tax Team.