Aviva comment on the Government's Autumn Budget

Lorna Whalley, Commercial Director

Today’s Budget replaces speculation with certainty.

It confirms changes such as an increase in employer national insurance from April 2025; it explains the new fiscal rules; and it presents the government’ spending priorities, including an additional investment in the NHS.

For pensions and ISAs, however, today’s Budget mostly replaces speculation with stability.

The Budget included no changes to pensions tax relief; no changes to the tax-free-lump-sum; no changes to the annual allowance; no reintroduction of the lifetime allowance; no changes to how national insurance relates to employer pension contributions; and no changes to ISAs.

This stability supports long-term financial planning.

As had been expected, the Budget has confirmed changes to capital gains tax and changes to inheritance tax. These changes will carry financial planning implications for some.

For capital gains tax, pensions and ISAs will continue to carry their exemption from CGT, but investments outside these products will experience a higher rate of CGT. The main rates of CGT are currently charged at a lower rate of 10% and a higher rate of 20%. These rates are to be increased to 18% and 24% respectively with immediate effect. These new rates will match the residential property rates, which are not changing.

As for inheritance tax, private pension wealth is to be included within an individual’s estate, with effect from April 2027. How this change will be implemented will be set out by the government in due course.

Budgets are significant events, covering every corner of the economy. This Budget is no exception. The value of financial advice has never been greater, and Aviva remains committed to supporting all advisers and their clients as they plan for their financial futures.