Key Takeaways:
- From April 2027, Cash ISA allowances will drop from £20,000 to £12,000 per tax year (for those under 65), encouraging the remaining allowance to be invested instead. However, your overall ISA Allowance is set to remain at £20,000.
- From 2029, salary sacrifice pension contributions over £2,000 per tax year will be subject to National Insurance.
- The freeze on income tax thresholds has been extended until April 2031.
After weeks of speculation, Rachel Reeves, Chancellor of the Exchequer stood up in the Commons on Wednesday (26th November 2025) to outline her plans for the forthcoming fiscal years.
What are the Autumn Budget changes — and how could they affect me?
Here’s an overview of the Budget’s key changes, including how and when they might impact you.
Cash ISA allowance
What's changing?
If you’re under 65, the amount you can put into Cash ISAs each tax year is dropping from £20,000 to £12,000. Over 65s will retain their full £20,000 Cash ISA allowance.
When will it take effect?
April 2027.
What this means for me?
The remaining £8,000 of your annual allowance will now need to be spread across other ISA types (Lifetime ISA restrictions also apply).
The Chancellor described this as £8,000 of your ISA allowance (across all ISA types) “designated exclusively for investment purposes”.
So, if you've been considering investing, this could be your opportunity to put any surplus money into our Flexible Stocks & Shares ISA.
(With investing your capital at risk.)
Salary sacrifice pension contributions
What's changing?
Salary sacrifice contributions over £2,000 per tax year will now be subject to National Insurance payments.
When will it take effect?
April 2029.
What this means for me?
Ask your employer, payroll, or HR team for help with this.
Our internal Payroll Team explains this as:
“From April 2029, if you contribute 5% of your salary into a pension using a salary sacrifice scheme, you will only have to pay National Insurance (NI) on your contributions if you earn over £40,000 per year. This means you'll only be impacted if you earn over this amount.
“If this does affect you, you'll pay National Insurance on your contribution at a rate of 8% per additional pound if your annual salary is less than £50,270.
“If you do earn more than this, however, you’ll pay a further 2% of NI on any contributions into your pension using a salary sacrifice scheme."
Income tax bands
What's changing?
The existing freeze on thresholds for basic, higher, and additional rate taxpayers is to be extended by a further three tax years.
When will it take effect?
This freeze was originally announced by a previous government and was to last until 2028/29. Under this year’s Budget announcement, this will now be continued until April 2031.
What this means for me?
If you live in England, Wales or Northern Ireland:
Basic rate income taxpayers might reach the higher income tax threshold sooner if you receive pay rises between now and 2029/30.
The same applies to higher rate taxpayers, who might move into the additional rate threshold by then, respectively.
Scottish residents have separate income tax bands.
Other points that were announced
- A new ‘pay-per-mile’ duty for electric vehicles (3p per mile for electric cars and 1.5p for plug-in hybrids).
- Removal of luxury vehicles from the Motability scheme; offering "cost-effective leases to disabled people”.
- The Chancellor also announced she is giving more money to local and regional leaders under devolution.
- In April 2026, the Universal Credit’s two-child benefit cap will end.
- Small and medium-sized enterprises in England will receive free support to offer apprenticeships for under-25s.
- And a final key point that may affect people with more expensive properties, a ‘Mansion tax’ charge will roll out for those valued at:
- More than £2 million (charged £2,500 annually),
- And £5 million (charged at £7,500).
Final note from Wealthify
"At times like this – when headlines seem louder than ever – you’ll often hear us talk about the importance of blocking out external noise.
"Now, that’s not to say avoid the news altogether; instead, it’s about avoiding any decisions driven by emotions and short-term thinking.
"Thankfully, this isn’t something you have to worry about with Wealthify’s experts managing your investments. Why? Because our decisions are driven by data — and our strategy by your long-term goals."
— Jessie Kwok, Wealthify’s Chief Investment Officer
Your tax treatment will depend on your individual circumstances, and it may be subject to change in the future.
With investing, your capital is at risk, so the value of your investments can go down as well as up, which means you could get back less than you initially invested.
Wealthify does not provide advice. If you’re not sure whether investing is right for you, please speak to a financial adviser.
