Big changes were announced on Wednesday with the Autumn Budget, so we’re here to give you a rundown…
Minimum Wage
As of April 2025, the minimum wage in the UK will increase to:
£7.55 an hour – for those under 18 or apprentices **
£10.00 an hour – for 18-20 year olds
£12.21 an hour – for those aged 21 and over
**apprentices under 19, or those who are over 19 but in their first year of their apprenticeship will earn £7.55 an hour. Once apprentices reach 19 or over and are no longer in their first year, they are entitled to the relevant minimum wage for their age group
Pensions
Both the basic state pension and new state pension will see a 4.1% rise next April due to the triple lock.
From April 2027, the amount you have in your pension that you have not already accessed is now going to form part of your estate for an inheritance tax calculation.
Bus Tickets
From January next year, there will be an increase to the £2 bus fare cap, bringing the cost of a single journey bus ticket up from £2 to £3.
However, you should check within your area for specific prices, as some areas may have their own bus fare caps through local authorities and mayors funding their own schemes to further keep fares down.
Fuel Duty
A decision has been made to maintain the 5p fuel duty cut, which was initially introduced as a temporary measure by the Conservative government in March 2022. This is to remain in place for another 12 months.
Secondary Properties and Stamp Duty
Those buying an additional property (i.e, a second or third or fourth etc home) currently have to pay an additional surcharge of 3% on top of Stamp Duty Land Tax.
This surcharge has been increased to 5% as of yesterday (31st October).
Capital Gains Tax
Capital Gins Tax (CGT) is being increased with immediate effect.
Basic rate taxpayers currently pay 10% CGT when selling assets other than residential property with profits over £3,000. This is being increased to 18%, and higher or additional rate taxpayers will now pay 24% instead of the 20% they were paying previous to the budget.
Private Schools
As we all expected, from January 2025, private schools will now pay 20% VAT on their school fees. You can read all about this on one of our previous blogs by clicking here.
Income Tax
The thresholds for income tax bandings remain unchanged. However, from April 2028, these bandings will increase with inflation, but do not yet know what these increases will be.
Inheritance Tax
As of April 2026, if you have assets worth over £1 million and some are held with the benefit of business relief or agricultural belief, you will no longer get 100% discount relief on these assets, and this will instead be dropped to a 50% relief.
This means you will pay some inheritance tax on these assets and they will be classed as part of your estate.
AIM Shares
At the moment, if you hold Alternative Investment Market (AIM) shares for at least 2 years before you die, you’re granted 100% business relief. This means the value of these shares are not included in any inheritance tax calculation.
However, from April 2026, the business relief on AIM shares has been halved, meaning your estate will have to pay tax on these, assuming your overall estate is at the level to pay IHT in the first place.
To read the Autumn Budget in full, click here.