What the Budget Could Mean for Your Money: Six Big Tax and Finance Changes to Watch
Income tax, pensions, property, ISAs and more – here’s what to expect from the Budget and how you can prepare.
Chancellor Rachel Reeves has set the stage for significant tax and spending changes in her autumn Budget on 26 November 2025. Millions of homeowners, savers, and pensioners could be affected.
With two weeks to go until the Budget, Reeves has hinted that everyone will need to “do their bit” to restore stability. That has fueled speculation about new or higher taxes, even though the government’s manifesto promised no increases for “working people” on income tax, VAT, or national insurance.
Here are six big changes expected in the Budget, what they may imply for your finances, and how you might act now.
1. Income tax may be rising
The UK government is facing a significant fiscal gap, with estimates suggesting a shortfall of around £30 billion or more. To raise revenue, a rise in income tax looks increasingly likely. One scenario is a 2p increase in the basic rate with a matching 2p cut in employees’ national insurance contributions (NIC), a structure that could raise about £6 billion.
For example, raising the basic rate from 20% to 21% could cost a taxpayer earning around £50,000 up to £377 a year.
Action point: Review your taxable income and consider whether any income could be deferred or accelerated before new rates take effect.
2. Pension tax reliefs under pressure
Tax reliefs on pension contributions and salary sacrifice schemes are likely to be under review. Some proposals include limiting how much you can reduce your taxable income via pension salary sacrifice or imposing a flat rate of relief instead of whichever rate you pay.
Action point: If you contribute via salary sacrifice, review the terms now and consult with your adviser about making catch-up contributions while the current rules apply.
3. Property, wealth and non-earned income in the spotlight
Property owners, landlords and those with significant assets are being tagged as key targets. Potential changes include:
A “mansion tax” or annual levy on homes above £2 million.
A replacement of stamp duty with a national property tax or shifting the burden from buyers to sellers on homes above £500,000.
Continuation of “stealth” tax rises through frozen income tax or NI thresholds that move more people into higher tax bands.
Action point: If you own property or receive rental income, assess the structure of your ownership and whether planning ahead could mitigate any impact.
4. Landlords and rental income may face tougher tax treatment
Tax regimes affecting landlords continue to evolve. One possibility is the introduction of NI on rental income or further restrictions on allowable expenses.
Action point: Review your rental income reporting, check your expense structure, and consider whether ownership should be via a company or other entity if appropriate.
5. Council tax and local property taxes may change
The current council tax system is widely regarded as outdated. Rumours suggest possible reforms, including:
A new annual percentage charge based on current property value rather than banding.
A surcharge or additional band for large homes or high-value areas.
Action point: If you own a high-value home or second property, check the implications of such reforms and whether any structuring, timing or ownership adjustments could be beneficial.
6. ISAs and cash savings may get less attractive
To encourage investment over cash savings, the government is reportedly considering reducing the cash ISA allowance (possibly to around £12,000) and tightening rules for ISAs overall.
Action point: If you are maximising cash ISAs, consider acting now to take advantage of current allowances. Also, evaluate whether shifting some savings into stocks and shares ISAs makes sense for your goals and risk appetite.
Why now matters: the broader context
The pressure on UK public finances is acute. Growth is weak, debt servicing costs have risen, and the government faces a widening fiscal deficit. Tax rises are expected not just as headline changes but through threshold freezes and relief cuts, meaning even if rates do not change, you could still end up paying more.
For high-net-worth individuals, the upcoming Budget is particularly significant, with expected changes to inheritance tax (IHT), capital gains tax (CGT), and wealth structuring.
What you can do now to prepare
Here is a short checklist:
Maximise your ISA allowance before any reduction.
Review pension contributions and salary sacrifice arrangements.
Assess rental income and property ownership structures.
Consider the timing of significant capital income, such as bonuses or asset sales, if you have flexibility.
For high-net-worth individuals, assess gift-giving, IHT planning, and CGT exposures.
Speak to a qualified professional to model different Budget scenarios based on your situation.
How Mercian Accountants can help
Whatever the final announcements on 26 November, the Budget is likely to reshape how individuals and businesses plan their finances. At Mercian Accountants, we help clients understand the practical implications of government changes – from tax planning and pension strategy to business structuring and property investment.
Our team will publish a full Budget summary and analysis immediately after the Chancellor’s statement, breaking down the key measures and explaining what they mean for you.
If you want tailored advice on how to prepare ahead of time or to receive our full post-Budget update straight to your inbox, get in touch with Mercian Accountants today.
The takeaway
This autumn’s Budget could be a turning point for UK taxation, savings and property planning. The cost of addressing public finances may be borne by individual taxpayers, particularly middle-income earners, savers, landlords, and large asset owners. Staying informed and acting promptly will give you the best chance to navigate the changes with confidence.
N.B. This document is for information only and does not constitute tax advice.
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