Thorne Widgery, one of Hereford and Shropshire’s leading accountancy firms, is encouraging the public to review their savings and investment plans after a series of significant announcements in this year’s Autumn Budget.
Following the early release of the OBR report, Chancellor Rachel Reeves delivered her first major economic update on 26 November, setting out the Government’s strategy for stability and long-term growth.
Income Tax thresholds frozen until 2031
One of the most notable changes is the decision to extend the freeze on Income Tax thresholds until April 2031.
Daniel Crowther, CEO at Thorne Widgery, said:
“By the time this freeze ends, Income Tax bands will have remained unchanged for almost a decade. What began in 2022 as a short-term measure has now been extended twice. While the Government can say it hasn’t increased Income Tax rates, the reality is that more people will be pushed into paying tax or into higher bands as wages rise.”
He added that this will place further pressure on families who have already faced years of financial strain.
Inheritance Tax and the new property surcharge
Inheritance Tax thresholds will follow the same path, remaining at £325,000 until 2031. Although not highlighted in the Chancellor’s speech, the change appeared in the accompanying Budget documentation.
The Government will also introduce a High-Value Council Tax Surcharge from 2028–29.
Properties valued above £2 million will face a £2,500 charge
Properties above £5 million will face a £7,500 charge
Daniel described the surcharge as “the closest thing to a wealth tax in this Budget, primarily affecting high-value homes—largely concentrated in London.”
He added that, combined with the freeze on Inheritance Tax, the long-term cost of holding or passing on property will increase, meaning families should plan ahead rather than make rushed decisions.
Higher taxes on property, savings and dividends were also announced, with a two-percentage-point increase to the basic and higher rates from 2026.
Pension changes
From April 2029, pension contributions made via salary sacrifice above £2,000 per year will attract National Insurance.
Daniel explained:
“Salary sacrifice has been a reliable and tax-efficient way to build pension wealth. Once this new charge applies, many savers will need to rethink how much they contribute and whether their current approach is still the most effective.”
ISA reforms confirmed
After months of speculation, the Chancellor confirmed changes to the ISA system. The overall £20,000 tax-free allowance remains, but from April 2027 the cash ISA limit will fall to £12,000. Savers will need to place the remaining £8,000 into a Stocks & Shares ISA if they want to use the full allowance.
This reduction will not apply to people aged 65 or over, who can still use the full allowance in cash ISAs.
Daniel said:
“Investing in shares can deliver stronger long-term returns, but it comes with greater risk. Those who prefer the certainty of cash will need clear advice to understand what this change means for them.”
Business impact
While the Budget focused mainly on individuals, businesses will also feel some pressure — most notably from the rise in the National Minimum Wage and National Living Wage coming in April 2026.
Thorne Widgery is advising clients to take action now:
“With many of these changes coming in over the next few years, there is time to prepare. Reviewing income, property portfolios, pensions and estate plans early will make the transition smoother.”
For more information, Contact us