Tax news in 2025
39 stories, newest first.
- November 2025
Autumn Budget 2025 announces NICs measures
The Autumn Budget on 26 November 2025 extended the freeze on most National Insurance limits to 2031, capped salary sacrifice relief from 2029 and removed Class 2 voluntary contributions from abroad.
Chancellor delivers autumn budget 2025 with £26.6bn of tax rises by 2030/31
Rachel Reeves delivered her second budget on 26 November 2025, with tax decisions forecast to raise £26.6bn by 2030/31 and personal tax thresholds frozen for a further three years.
Department for Education confirms updated student loan repayment thresholds for Plan 2 and Plan 3 from April 2026
The Department for Education confirmed on 26 November 2025 the student loan repayment thresholds for Plan 2 and Plan 3 loans that apply from April 2026, including £29,385 for Plan 2.
Government extends income tax and National Insurance threshold freeze by three years
The 2025 Budget extended the freeze on income tax and National Insurance thresholds by three years, taking it beyond its scheduled April 2028 end date and prompting dispute over Labour's manifesto pledges.
Salary sacrifice pension contributions above £2,000 to face National Insurance from April 2029
The government will cap the amount of salary sacrifice pension contributions exempt from National Insurance at £2,000 a year from April 2029, under changes announced at Autumn Budget 2025.
Tax Information and Impact Note published for the Winter Fuel Payment Charge measure
A Tax Information and Impact Note on the Winter Fuel Payment Charge was published on 26 November 2025, alongside clause 55 and Schedule 10 to the Finance (No. 2) Bill 2025.
Budget 2025 announced NICs thresholds frozen until 2030-31
Budget 2025 extended the freeze on Income Tax and National Insurance thresholds for a further three years, with the main personal allowance and higher rate threshold held until 2030-31.
Budget 2025 announces changes to income tax, duties and allowances
Budget 2025 raises dividend tax from April 2026 and savings and property income tax from April 2027, freezes personal allowances to 2031 and adds new duties on vaping and gambling.
Chancellor announces freeze of student loan repayment threshold at 2025 Budget
The Chancellor announced at the 2025 Budget that the student loan repayment threshold of £28,470 will be frozen for three years from April 2027, with a Treasury Committee inquiry into graduate taxation following in March 2026.
Personal Allowance freeze extended to 2030 to 2031 at Autumn Budget 2025
The Personal Allowance stays at £12,570 through to 2030 to 2031 after the freeze was extended at Autumn Budget 2025, with the number of Income Tax payers projected to reach 40.8 million.
Personal tax threshold freeze extended by three years
The freeze on personal tax thresholds was extended by three years to 2030-31 in the 2025 Autumn Budget, keeping the personal allowance at £12,570 and the higher rate starting point at £50,270.
Salary sacrifice pension contributions NICs exemption capped from April 2029
The Government Actuary has set out the effect of the November 2025 Budget measure that caps the National Insurance exemption for salary sacrifice pension contributions at £2,000 a year from April 2029.
- October 2025
HMRC restarts taking tax debts directly from bank accounts
HMRC has relaunched its Direct Recovery of Debts power, allowing it to take unpaid tax directly from bank accounts and cash Isas in a test and learn phase after pandemic suspension.
HMRC begins sending Simple Assessment letters
HMRC began issuing Simple Assessment letters in October 2025, setting out tax owed on 2024/25 income for people who do not file a Self Assessment return.
- July 2025
Guidance added on repaying the Winter Fuel Payment
HMRC has added guidance explaining who must repay the Winter Fuel Payment and how the money will be recovered through tax codes or Self Assessment returns.
Consultation on Council Tax administration and enforcement in Wales closes
The Welsh Government's consultation on changing Council Tax administration and enforcement in Wales closed on 23 July 2025, with 272 responses and proposals due to take effect from 1 April 2026.
Draft Finance Bill 2025-26 published
The Lords Economic Affairs Finance Bill Sub-Committee has published a report on inheritance tax measures covering unused pension funds and agricultural and business property reliefs in the draft Finance Bill 2025-26.
Draft legislation published for MTD for Income Tax and penalty reform
HMRC has published draft legislation to refine and simplify Making Tax Digital for Income Tax and penalty reform, including deferrals for certain groups and a consultation closing on 16 September 2025.
Government abandons PSA-led model for Inheritance Tax on pensions
The government has dropped plans to make pension scheme administrators responsible for reporting and paying Inheritance Tax on unused pension funds, keeping that duty with personal representatives from April 2027.
Government publishes consultation outcome confirming personal representatives liable for IHT on pensions from April 2027
The government has confirmed that personal representatives, not pension scheme administrators, will report and pay inheritance tax on unused pension funds and death benefits from 6 April 2027.
More than 18,000 claims for overpaid inheritance tax made in three years
HMRC figures obtained by NFU Mutual show more than 18,000 claims for overpaid inheritance tax in three years, most of them after property sold for less than its value at death.
HMRC figures confirm more people pulled into higher tax bands
HMRC estimates show around half a million more people moving into the higher-rate tax band this year, with 420,000 more pensioners paying tax on retirement income.
- June 2025
ISA Regulations amended to allow long-term asset funds in innovative finance ISAs and tighten subscription rules
The Treasury has amended the ISA Regulations 2025 to add long-term asset funds to innovative finance ISAs, require national insurance information before subscriptions and tighten replacement subscription rules.
- May 2025
entitledto publishes 2025/26 review of English Council Tax Reduction schemes
entitledto's annual review of English Council Tax Reduction schemes finds 62 of 296 councils changed their calculations for 2025/26, with cuts to maximum support outnumbering increases.
- April 2025
Income Tax rates updated for 2025 to 2026
HMRC has updated its published Income Tax rates, allowances and bands for the 2025 to 2026 tax year, with the change logged on the GOV.UK rates and allowances page on 6 April 2025.
Scottish Income Tax changes take effect
Scottish Income Tax rates and bands for 2025-26 took effect on 6 April 2025, with the Starter and Basic rate bands widened and the Higher, Advanced and Top rate thresholds frozen.
April 2025 tax, benefit and bill changes take effect
Freezing of personal tax thresholds, a higher employer National Insurance rate, Council Tax and water bill rises, a £111 energy price cap increase and 1.7 per cent benefit uprating all took effect in April 2025.
Class 1 Secondary NICs rate to rise to 15% with threshold lowered to £5,000
Employer National Insurance contributions rise from 13.8% to 15% and the point at which they become payable falls from £9,100 to £5,000 a year from 6 April 2025.
Council tax bills expected to rise across England and Wales from April 2025
Council tax bills rise across England, Wales and Scotland from April 2025, with English bills up about 5% on average and Scottish bills up 9.6%, as most English councils use their referendum-free limit.
Employer NI rise took effect, pushing employee tax wedges up
The April 2025 employer National Insurance rise took effect, raising the effective tax rate on the median employee to 27 per cent, the highest since 2011-12.
HMRC to end overtaxing of first pension withdrawals from April 2025
HMRC has changed how tax codes are applied to new private pension withdrawals from April 2025, aiming to stop savers being overtaxed on their first payments.
Vehicle tax rates introduced for electric, zero and low emission vehicles
Electric, zero and low emission cars, vans and motorcycles became subject to vehicle tax rates introduced on 1 April 2025, with the change applying to both new and existing vehicles.
Winter Fuel Payments charge takes effect from 6 April 2025
A new income tax charge takes effect from 6 April 2025 to recover Winter Fuel Payments from pensioners with total income over £35,000, collected through PAYE or Self Assessment.
- March 2025
SDLT nil-rate bands and FTBR thresholds reverted to pre-September 2022 levels
From 1 April 2025 the stamp duty nil-rate band in England and Northern Ireland fell back to £125,000, with first-time buyer thresholds also reduced, as legislated in 2023.
Government confirms DRD restart in Spring Statement
The government confirmed in the Spring Statement that HMRC will restart its Direct Recovery of Debts power, taking unpaid tax directly from bank accounts and cash Isas.
Six English councils permitted to raise council tax above the 4.99% cap
Six English councils have been allowed to raise council tax above the 4.99% referendum threshold for 2025-26, with Bradford permitted the largest increase at 9.99%.
Spring Statement announces payroll option for paying the high-income child benefit charge
Families liable for the high income child benefit charge will be able to pay it through their tax code and company payroll from summer 2025, under changes announced in the Spring Statement.
- February 2025
Alcohol duty rates change from 1 February 2025 until 1 February 2026
New alcohol duty rates per litre of alcohol apply from 1 February 2025 until 1 February 2026, under rates published alongside the Autumn Budget 2024.
Alcohol duty rises in line with RPI, with a cut for draught products
Alcohol duty rose on 1 February 2025 in line with September 2024 inflation of 2.7%, while duty on draught products below 8.5% ABV was cut by 1.7%.