Autumn Budget 2025 for Expats & Investors

Posted on: 26th November 2025 in News

Chancellor Rachel Reeves delivered her second Autumn Budget in dramatic circumstances, after the Office for Budget Responsibility (OBR) accidentally released its full economic outlook online 45 minutes before her speech.

Yet, amid the chaos, one thing became immediately clear:

This is another tax-heavy Budget.

Reeves plans to raise £26bn in additional taxes by 2029–30, pushing the UK tax burden to 38% of GDP — an all-time high.

Reeves insists her approach is “fair”, asking those with the broadest shoulders to bear the heaviest load.

But for high-net-worth individuals (HNWIs), expats, non-doms, property investors and globally mobile professionals, this Budget marks another step in a long-term tightening of the UK tax environment.

Now that the dust has settled, here’s what the 2025 Autumn Budget really means for you and your money.

Freeze on personal tax thresholds

One of the headline announcements — confirmed unintentionally by the OBR leak — is that all personal income tax thresholds will remain frozen until 2030–31. This includes:

Personal Allowance: £12,570
Higher-rate threshold: £50,270
Additional rate: £125,140

Freezing thresholds is often described as a stealth tax, because rising wages pull more people into higher tax bands without any changes to rates.

The OBR estimates the freeze will raise:

£8.3bn a year by the end of the decade
£7.6bn in 2029–30 alone

For expats returning to the UK or globally mobile workers with UK income, this means a significantly higher tax burden in the years ahead.

This makes offshore investment wrappers, trusts, and expat-friendly pension structures even more valuable.

Salary sacrifice pensions targeted

The government’s second-largest revenue-raising measure is a clampdown on salary sacrifice pension contributions.

Currently, high earners — including many professionals working abroad but paid via UK payroll — use salary sacrifice to reduce taxable income while boosting pension contributions.

Reeves confirmed changes that will raise £4.7bn, making this strategy less attractive.

Long-term, UK-based pension planning may become less competitive for expats and HNWIs compared to alternatives like Qualifying Non-UK Pension Schemes (QNUPS), other international pensions, and offshore retirement structures.

Dividend tax increase from April 2026

Investors, directors, and business owners face further tax rises.

From April 2026, dividend tax will increase by 2 percentage points:

Basic rate: 10.75%
Higher rate: 35.75%

This measure is expected to raise around £1.2bn annually.

For non-residents receiving UK dividends, this further reduces net returns and the appeal of holding UK company shares through personal ownership.

Investors may wish to consider corporate structures, international investment bonds, or offshore companies to limit exposure to UK dividend tax.

Cash ISA allowance reduced for under-65s

The government will cut the annual Cash ISA limit from £20,000 to £12,000 for anyone under 65, in an effort to push more savers toward investment-based ISAs.

Over-65s will retain the full £20,000 allowance.

Around a quarter of Cash ISA savers currently contribute above £12,000, meaning many — including returning expats with sterling savings — will see reduced tax-free capacity.

For high-balance savers, this increases the relative importance of offshore investment solutions and diversified, multi-jurisdictional portfolios.

Savings income tax rates rising from 2027

From April 2027, savings income tax will increase by two percentage points across all bands, to:

Basic rate: 22%
Higher rate: 42%
Additional rate: 47%

Most people do not save enough to exceed their Personal Savings Allowance, but those with larger cash holdings, offshore accounts or multi-currency deposits will see higher tax leakage.

This rise comes alongside increases in dividend tax and property income tax, further weakening the UK’s attractiveness as a hub for passive income.

New charges on high-value homes

One of the most controversial measures affects UK property owners — including overseas investors.

From April 2028, homes valued at £2m or more will face a recurring annual council tax surcharge:

£2,500 for homes at £2m–£2.5m
£7,500 for homes at £5m+

This is in addition to existing SDLT, CGT on disposals, and income tax on rental profits.

Over the next 24 to 36 months, investors may find it attractive to diversify into international property markets or alternative asset classes.

But the impact of the property measures extends beyond high-value homeowners.

Mixed fortunes for renters and first-time buyers

The property changes do not stop with owners of high-value homes.

Landlords will face a higher overall tax burden, which forecasters expect to feed through into higher rents for tenants over time.

At the same time, the government plans to replace the Lifetime ISA — criticised for complex rules and penalties — with a simpler scheme focused solely on saving for a first home, rather than retirement.

Details are still limited, but the aim is to support new buyers. Whether this will be enough to offset rising rents and affordability pressures remains to be seen, particularly in London and other high-demand cities.

For expats planning a return to the UK or investors helping family onto the property ladder, these reforms add another layer to long-term property planning.

Enterprise incentives expanded

Despite the tougher outlook, there is some good news for investors. The government plans to:

Extend eligibility for the Enterprise Management Incentive (EMI) scheme
Update EIS and VCT rules so they also support scaling businesses
Give new UK stock market listings a three-year exemption from stamp duty reserve tax

These measures are designed to keep investment flowing into UK companies during the slowdown.

Foreign investors and expats could find renewed value in UK early-stage investments when these are structured tax-efficiently, especially through offshore portfolio bonds.

State Pension set to rise

While most measures in this Budget were tax-heavy, one of the few upward adjustments is the State Pension.

From April 2026, payments will rise by 4.8%, following the triple lock formula, which increases the pension by the highest of inflation, earnings growth (4.8%), or 2.5%.

This means:

Full New State Pension: rising from £230.25 → £241.30 per week
Full Basic (Old) State Pension: rising from £176.45 → £184.90 per week

Nearly two-thirds of pensioners remain on the older, lower-rate system, meaning the uplift is materially smaller for most retirees.

While the rise helps UK-based pensioners maintain purchasing power, it does little for HNWIs or expats whose retirement income typically comes from private pensions, QROPS/QNUPS, or offshore retirement structures.

Your State Pension can still play a key role in retirement—speak to our team about topping it up.