Spring Statement 2025: Impact and opportunities

On Wednesday we saw Rachel Reeves deliver Labour’s Spring Statement, with a promise from the government to remain active in order to deliver prosperity to the UK. This most recent fiscal update reinforces the measures we saw announced in last October’s Autumn Budget, and delivered some new changes which aim to deliver economic stability and reduce inflation.  

We saw no further tax increases, with Reeves firmly reiterating that her fiscal rules from the Autumn – which aim to raise £40bn through a number of taxation increases - will continue to support working people and help boost growth in the UK over the long term.  

As expected, defence spending increased, and this will be funded from cost savings and a further crackdown on tax evasion, rather than tax increases. 

The Government also announced that it will review options for potential reforms to ISAs and tax reliefs such as the Enterprise Management Incentives Scheme, the Enterprise Investment Scheme and the Venture Capital Trust Scheme – this will potentially soften the ground for further changes in the Autumn Budget later this year, we look forward to seeing the detail of the legislation and we are alert to the fact that future changes to taxation are possible. 

This most recent announcement was more an update rather than an unveiling of new measures and with this in mind, we’ve summarised the fiscal changes that are yet to come and important upcoming dates to be aware of. 

Significant changes to pension legislation were announced in the Autumn and nothing further was mentioned in the Spring Statement. From April 2027, inherited pensions will be subject to Inheritance Tax (IHT), a substantial shift from the current position. We await the details of how this will be implemented when the outcome of the recent consultation is published. 

Similarly to the Autumn, there are no changes to what individuals can withdraw, tax free, from their pensions. Currently the lump sum withdrawal remains at 25%. The annual allowance and tax relief on pension contributions will also remain the same. This re-affirms pensions as an efficient way to save for retirement. 

There are no updates to the changes to CGT implemented last Autumn, where we saw rates increase to 18% (basic rate) and 24% (higher rate).

We note that carried interest CGT rate for fund managers will increase from 28% to 32% from April 2025.

As announced in the Autumn, Stamp Duty on second homes is set to rise from 3% to 5% from April 2025. Meanwhile Capital Gains Tax rates on second properties are maintained at 18% and 24%.  

There is no change to the Chancellor’s freeze on IHT, which will be extended to 2030 – this means more estates are likely to exceed the nil rate band over this time period, especially with the changes to pensions mentioned above. 

From April 2026, the government will reform agricultural property relief and business property relief – the reforms are as follows:  

• The first £1m of combined business and agricultural assets will continue to be free of IHT. For assets over £1m, IHT will apply with a 50% relief at an effective rate of 20% 
• A reduction to the rate of Business Property Relief available from 100% to 50% for shares on the Alternative Investment Market (AIM). This effectively sets a new tax rate of 20% tax, adjusting the relief though not removing it entirely, as was rumoured 

We await the full details of implementation to be published. 

Notwithstanding the potential reforms announced to ISAs, subscription limits currently remain unchanged. As a reminder, these are:   

• £20,000 for ISAs 
• £4,000 for Lifetime ISAs (included in the £20,000 ISA subscription limit)  
• £9,000 for Junior ISAs and the Child Trust Fund 

Employers can still expect to pay more in NIC next year, with no change to the government’s plan to increase this tax by 1.2 percentage points, from 13.8% to 15% - this comes into play from 6 April 2025. 

Additionally, the freeze on the threshold at which National Insurance is paid by employers on employees’ salaries - currently reduced from £9,100 per year to £5,000 - has not been extended and will increase with inflation from 2028/29. 

This most recent update from the government is a timely reminder to continue your consideration of the upcoming tax changes from the Autumn Budget in October, which have yet to take effect. These may have implications for your personal finances depending on your situation. The dates of these fiscal changes are varied, and we will see them take affect this year, into 2026, 2027 and beyond. 

In this changing landscape, understanding details and timelines of taxation changes is important and the value of good financial planning remains. This recent update may be an opportunity to revisit your financial plan and ensure you make use of allowances available to you. 

 

Please note that any tax benefits will depend on your personal tax position and rules are subject to change. The value of investments can go down as well as up, and you may get back less than you invested.

 

Important information

The information contained in this document is believed to be correct but cannot be guaranteed. Past performance is not a reliable indicator of future results. The value of investments and the income from them may fall as well as rise and is not guaranteed. An investor may not get back the original amount invested. Opinions constitute our judgment as at the date shown and are subject to change without notice. This document is not intended as an offer or solicitation to buy or sell securities, nor does it constitute a personal recommendation. Where links to third party websites are provided, TrinityBridge accepts no responsibility for the content of such websites nor the services, products or items offered through such websites.