Autumn Budget 2025: when it is and what will it contain?

Chancellor Rachel Reeves has confirmed that this year’s Autumn Budget will take place on Wednesday 26 November.

Reeves faces pressure to grow the economy and manage the UK’s finances as government borrowing costs hit a 27-year high.

Speculation over tax reform has been building in the lead up, with potential changes to inheritance tax, capital gains tax, stamp duty and council tax.

Here, Which? rounds up the latest rumours — and what they could mean for your finances.

Inheritance tax on gifts

The Chancellor announced in last year’s Autumn Budget that private pensions would be included in the scope for inheritance tax (IHT) from April 2027. But rumours suggest she could be preparing to make further changes to the tax.

The Guardian has reported that the Treasury is said to be considering a lifetime cap on the value of gifts that can be made before death.

Under current rules, there’s no overall cap on how much you can gift tax-free during your lifetime, as long as you survive seven years after making the gift. A cap would place a limit on how much can be passed on during your lifetime.

It's also been reported that taper relief could be adjusted or even removed. Such a change would create a 'cliff edge' in the system, meaning beneficiaries could face a substantial tax bill if the person who made the gift died just one day short of seven years.

• Find out more: will inheritance tax rules on gifts be tightened? 

Pension tax relief changes

When you pay into a pension, the government adds tax relief at your highest rate of income tax — 20% for basic-rate taxpayers, 40% for higher-rate and 45% for additional-rate. 

Rumours on pension changes come up every single year and are often not based on anything official. However, the Institute for Fiscal Studies (IFS) has suggested that the current system is expensive and benefits higher earners more. 

One option put forward is moving to a flat rate for everyone, potentially around 25-30%. This would give basic-rate savers more support, but would reduce the perk for those on higher incomes.

• Find out more: how to calculate pension tax relief

Two-child benefit cap scrapped

The Guardian has reported that Rachel Reeves will lift the two-child benefit cap in the Budget. Government officials are reportedly considering options, including a higher cap alongside a tapered system for larger families. 

The policy currently prevents families from claiming the Universal Credit child element – worth £292.81 a month – for a third or subsequent child born after 6 April 2017. Any change is likely to follow recommendations from the government’s child poverty task force. 

Speaking at a fringe event at the Labour Party Conference, the Chancellor said that lifting the cap entirely would depend on finding the money to pay for it. 

The Institute for Fiscal Studies (IFS) has estimated that removing the limit would cost £3.4bn a year. 

• Find out more: what is Universal Credit and how much will I get?

Council tax reform

According to a report in The Guardian, the Treasury is considering introducing a new annual local property tax with bills based on the current value of a home.

Details of how this would work have not been confirmed, although a shake-up to council tax has been discussed for years. 

The current system in England and Scotland is based on valuations from 1991. Wales uses 2003 property values, although the Welsh government has announced its own reforms to the system from 2028.

Council tax is currently divided into bands (A to H in England), with charges set by local authorities. In 2024–25, the average Band D council tax bill in England was £2,171. 

The outdated banding means some households in less valuable homes pay proportionally more than those in higher-value properties.

•  Find out more: council tax calculator 2025-26

Scrapping stamp duty

In the same Guardian report, the Chancellor is said to be considering a new tax on home sales, which would replace stamp duty on owner-occupied homes.

Under the reported proposal, sellers – rather than buyers – would be responsible for paying the tax on properties sold for over £500,000.

Currently, first-time buyers pay stamp duty on any portion of a property's price above £300,000, as long as the home costs £500,000 or less. Previously, no stamp duty was due on the first £425,000 of a property costing up to £625,000.

Stamp duty is calculated in bands, with first-time buyers paying 5% on the portion between £300,001 and £500,000.

Existing buyers now pay 2% on the portion from £125,001 to £250,000, and 5% from £250,001 to £925,000. 

• Find out more: stamp duty calculator

Cut to VAT on energy bills

Energy Secretary Ed Miliband has suggested the government could consider cutting VAT on energy bills.

Speaking on the BBC’s Sunday with Laura Kuenssberg programme, Miliband said ministers were 'looking at all of these issues' when asked whether the government might scrap the current 5% rate. He added that the country was facing a 'cost of living crisis that we need to address as a government.'

Labour’s manifesto pledged to lower annual energy bills by £300 by 2030. Miliband said he stood by this commitment but declined to comment further ahead of the Budget.. 

• Find out more: best energy suppliers for 2025

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Motability scheme reforms 

The Times reports that the government is planning major reforms to the Motability scheme, which provides cars to disabled people through the benefits system.

More than 800,000 people currently have a Motability car, with eligibility rising by over half a million since 2019.

Proposed changes include scrapping tax breaks worth around £1bn a year by reducing exemptions for VAT and Insurance Premium Tax on leased vehicles. 

The government is also said to be considering removing luxury models such as BMWs and Mercedes, currently leased by more than 40,000 claimants, from the scheme.

• Find out more: mobility car scheme explained

National Insurance for landlords

The Times reports that the Chancellor is considering applying National Insurance to rental income for landlords – a move that could raise around £2.3bn a year.

At the moment, rent is largely exempt from National Insurance. But under the leaked proposals, landlords would pay the same 8% rate as the self-employed on their rental profits.

The estimate is based on Office for National Statistics figures, which show that 2.2 million landlords shared £27bn in rental income in the 2022-23 tax year. 

• Find out more: how rental income is taxed

New 'mansion tax'

A new ‘mansion tax’ is reportedly being considered by the Chancellor, according to The Times. The proposal would see capital gains tax (CGT) charged when someone sells their main home, based on the amount it has increased in value during ownership.

It’s expected that the change would only apply to the most expensive properties. Reports suggest a threshold of £1.5m could affect around 120,000 homeowners, with higher-rate taxpayers facing CGT bills of almost £200,000.

CGT is already payable when you sell a property in certain circumstances – such as second homes, buy-to-let properties or homes with substantial land or business use.

• Find out more: when do you pay capital gains tax?

Cuts to cash Isa allowances

The government is reportedly planning to revisit plans in the Budget to overhaul cash Isas, in an effort to steer savers towards investment.

According to the Financial Times, the Chancellor is considering cutting the annual tax-free cash Isa limit from £20,000 to £10,000. Earlier proposals had gone further, suggesting a cap as low as £4,000.

Treasury officials are also said to be weighing up the return of a previously shelved ‘British Isa’ scheme. This would give investors an additional £5,000 tax-free allowance to put into UK-listed shares. 

The idea was first floated under the Conservative government but later dropped by Labour, which argued it would make the Isa system too complicated. 

• Find out more: best cash Isa rates 2025

Gambling tax

Former Prime Minister Gordon Brown has backed calls for a new tax on profits made by online casinos, slot machines and other high-stakes betting firms. 

The Institute for Public Policy Research (IPPR) think-tank said raising various gambling taxes would earn the Treasury around £3.2bn extra per year.

The government is already consulting on plans to merge various betting taxes from October 2027, in a bid to make the taxation of free bets, free plays and prizes more consistent.

• Find out more: how much tax you pay

Freezing income tax thresholds

Labour’s manifesto promised not to raise income tax on working households, and both the Chancellor and the Prime Minister, Keir Starmer, have reiterated that the government would uphold this promise. 

Income tax thresholds have been frozen since 2021, and in last year’s Autumn Budget, Reeves announced that they would be unfrozen in 2028. Frozen thresholds are often dubbed as a ‘stealth’ tax, as they raise money without having to raise rates. This is because, as wages rise, more people start paying tax and more people are pushed into higher tax brackets. 

However, it is now widely reported that the Chancellor will extend the freeze by an additional year to 2029-30. According to reports, this would help generate an additional £10bn in tax.

• Find out more: UK income tax rates 2025-26 and 2024-25

20% VAT on taxi journeys

The Telegraph has reported that the government is set to impose a flat 20% VAT fee on all private hire bookings in this year’s budget. Currently, most individual taxi drivers do not have to charge VAT because their earnings are below the £90,000 VAT threshold. 

However, large private hire companies such as Uber and Bolt have revenues that exceed this amount. The core debate is whether these companies should charge VAT on the entire fare, which would significantly increase costs for passengers.

The government is still reviewing a consultation on this issue, which was first launched last year, and has not made a final decision. 

Treasury minister Dan Tomlinson said this month that the government ‘takes this complex issue very seriously and recognises businesses’ need for certainty’. 

He added: ‘The government is carefully considering the wide range of views shared through last year’s consultation on the VAT treatment of private hire vehicles and will publish a detailed response soon.’ 

The Telegraph reports that the so-called ‘taxi-tax’ could raise around £750m a year for the Treasury.

• Find out more: self-employed income tax, National Insurance and VAT

This story is regularly updated with the latest Budget rumours.