Lilywhite Mortgages - Budget 2025 Highlights

27th November 2025

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Mansion Tax - Owners of properties worth more than £2 million will be hit by a new “mansion tax” that will net the government £400 million per year, the Chancellor has confirmed. The levy will take the form of council tax surcharge from April 2028

Property Income Tax Increases – Tax paid on income from property, savings and dividends will be increased by 2%

Salary Sacrifice  - From April 2029, only the first £2,000 of employee pension contributions through salary sacrifice each year will be exempt from NICs.

Cash ISA limit - - From April 2027, Cash ISA tax-free allowance has been cut to £12,000, but £8,000 of this will now be designated exclusively for investment purposes. Over 65s, though, will retain the full cash allowance of £20,000.

Income Tax & NI Thresholds frozen until 2031

Increase in National Living Wage – by 4.1% to £12.71 for those over 21 and £10.85 for those aged 18-20

Tax on Electric Cars – 3p per mile for fully electric and 1.5p per mile for hybrid from April 2028

Fuel Duty Frozen – until September 2026

Funding provided to make training for the under 25’s free for small and medium sized enterprises