Chancellor Rachel Reeves set out the Budget on 26 November 2025 after the Office for Budget Responsibility (OBR) accidentally published parts of its outlook early. HM Treasury’s documents confirm a tax‑raising package: income tax thresholds held until April 2031, higher taxes on income from assets, a new per‑mile charge for electric cars from 2028 and a high‑value home surcharge from 2028. The OBR and Reuters put the overall tax take at roughly £26bn a year by 2029/30.

What the threshold freeze means in practice is simple: more people drift into higher bands as pay rises. From April 2028 through April 2031 the Personal Allowance stays at £12,570, the higher‑rate threshold at £50,270 and the additional‑rate threshold at £125,140. Scotland sets its own rates on earned income, but the UK‑wide thresholds still bite for savings and dividends.

Tax on income from assets is going up in stages. From April 2026 the ordinary and upper rates on dividend income rise by two percentage points to 10.75% and 35.75%. From April 2027 the basic, higher and additional rates on savings income move to 22%, 42% and 47%, and property (rental) income will be taxed at its own 22%, 42% and 47% bands across England, Wales and Northern Ireland. The Treasury says this narrows the gap with employment income that also attracts National Insurance.

Savings rules shift in other ways too. The annual cash ISA limit will be cut to £12,000 from 6 April 2027, while the overall ISA allowance remains £20,000. Savers over the age of 65 can still put £20,000 into cash ISAs, and ISA limits are frozen until 5 April 2031. The Lifetime ISA will be replaced by a simpler first‑home product after a consultation in early 2026. For 2025/26 and 2026/27, the £20,000 cash ISA limit still applies.

At the other end of the savings spectrum, Help to Save becomes a permanent fixture. From April 2028 eligibility expands to all Universal Credit claimants receiving the child or caring element, keeping the 50% government bonus (up to £1,200 over four years) to build emergency pots for lower‑income households.

Pension saving via salary sacrifice changes later. From April 2029, only the first £2,000 of employee pension contributions made through salary sacrifice will be exempt from National Insurance; amounts above that will attract normal employer and employee NICs. Income tax relief is unchanged. The OBR expects the reform to raise around £4.7bn in 2029/30.

Minimum pay rises again next spring. From 1 April 2026 the National Living Wage moves to £12.71 (age 21+), the 18–20 rate to £10.85 and the 16–17 and apprentice rates to £8.00. For a café employing five 21‑year‑olds on 35 hours, that’s roughly £45 extra per worker per week before on‑costs. The Low Pay Commission’s advice underpins the uprating.

Drivers of battery‑electric cars will pay 3p per mile from April 2028, with plug‑in hybrids charged 1.5p. Rates rise with inflation. The OBR says a typical EV driver clocking 8,500 miles would pay about £255 in 2028/29, with the scheme designed around self‑reported annual mileage rather than real‑time tracking.

For petrol and diesel users, the 5p “temporary” cut in fuel duty is extended to the end of August 2026, then unwound in stages from September 2026 before indexation resumes. That preserves near‑term relief at the pumps but sets a timetable for duty to rise for the first time in years.

Public transport gets a mixed package. Regulated rail fares in England are frozen for one year from 1 March 2026 to March 2027-the first such freeze in 30 years-covering seasons and most commuter tickets. The £3 cap on most single bus journeys in England is funded through to March 2027.

Housing policy takes a sharper turn at the top end. From April 2028, a High Value Council Tax Surcharge applies in England: £2,500 a year for homes valued between £2m and £2.5m, rising to £7,500 for properties worth £5m or more. Values will be based on 2026 Valuation Office assessments and uprated with inflation; ministers say fewer than 1% of properties will be caught.

Landlords face a higher tax burden as property income rates climb to 22%, 42% and 47% from April 2027. The OBR notes this will reduce returns and could trim rental supply over time, risking steady rent rises if demand holds-another reason to stress‑test buy‑to‑let cashflows.

Energy bills should fall modestly. From April 2026 the government will scrap the Energy Company Obligation levy and fund 75% of the domestic Renewables Obligation from general taxation for three years, which the Treasury and Reuters say cuts average household bills by around £150 a year. Critics argue removing insulation funding hits long‑term savings, but the change still shaves near‑term costs.

The welfare side shifts too. The two‑child limit in Universal Credit is removed from April 2026, with the Treasury estimating 450,000 fewer children in poverty by the end of the Parliament. Working‑age benefits linked to the annual uprating will rise by 3.8% next April in line with September inflation.

State pensions keep the triple lock. From April 2026 the full new State Pension rises by 4.8% to about £241.30 a week. On HMRC’s standard calculation that puts a full‑rate recipient just under the frozen £12,570 Personal Allowance for 2026/27, so someone with only the state pension should remain outside income tax next year.

For households and small firms, the timeline matters. Big changes cluster in April 2026 (wages, benefits, rail fares, energy bill levies, dividend tax) and April 2027 (savings and property income tax, ISA rules), with the EV levy landing in April 2028 and the salary‑sacrifice cap in April 2029. Cash‑flow planning now-before allowances and rates move-will soften the blow when the calendar turns.