So, what’s new and how might it affect your finances? Private Client Associates Sam Hardy from our Market Harborough office and Rebecca Lee from our Leicester office break down the key measures announced.
Stamp Duty Land Tax (SDLT) and Mansion Tax
After speculation of major changes to SDLT – including an annual property tax model, and staggered payments – none of these were actually announced.
- Buyers still pay SDLT under the existing band system
- First-time buyer relief remains, as does the 5% surcharge on second homes / buy-to-lets
- There is no instalment payment model
So, what changed?
Instead, the chancellor introduced a new annual ‘high-value property council tax surcharge’ for England. From April 2028, an additional yearly charge will apply to homes worth:
- £2-2.5 million: £2,500
- £2.5-3.5 million: £3,500
- £3.5-5 million: £5,000
- £5 million plus: £7,500
Homes likely to be affected the most are those in London and the South East (thought to be >1% of total UK homes).
What does this mean for you?
If you’re planning to buy a property, your up-front SDLT costs remain the same. If you own a £2m+ home, you will need to budget for a new annual charge from April 2028. For landlords / property investors, SDLT is unchanged – although income tax on rents is set to rise from 2027 by two percentage points across the board:
- 22% for basic-rate taxpayers
- 42% for higher-rate taxpayers
- 47% for additional-rate taxpayers
This move is in line with Labour’s broader plan (or “raid” as it might be termed) for higher tax on ‘income from assets’.
Capital Gains Tax (CGT)
Speculation was of potential increases to CGT rates, withdrawal of main residence relief, reduction of annual allowance, and an ‘exit tax’ for those leaving the country permanently.
Again, none of these came in, and for most homeowners/landlords, CGT is unchanged.
Did anything else change?
Nothing we’ll materially see affect our lives, for now at least. The chancellor discussed targeted reforms on certain types of business transactions, and some anti-avoidance regulations, but not something that’ll hit everyday property owners. Important CGT rules, such as main home exemption from CGT, remain in place, whilst selling a second home carries the same rates as before.
Inheritance Tax
Inheritance Tax remains politically sensitive, but changes are coming:
- Nil rate band freeze extended
The £325,000 tax-free threshold has been frozen since 2009 and now extended further to 2031. With rising house prices and pensions included in estates from April 2027, more families will face IHT - Reliefs tightened
Agricultural and business property reliefs will be capped at £1 million per person from April 2026, with any excess qualifying for only 50% relief. The unused allowance from the first spouse to pass away is now transferable to the second spouse - Infected Blood Compensation
There will be no Inheritance Tax payable on compensation from claims in relation to the Infected Blood Scandal
What does this mean for you?
Estate planning just got more complex. If you’ve been relying on lifetime gifts or reliefs, now is the time to review your strategy.
What should you do now?
The Autumn Budget 2025 signals a clear shift toward taxing wealth and property more aggressively, even if the biggest changes are still a few years away. Whether you’re buying a home, managing rental income, or planning your estate, early action can help you stay ahead of rising costs and tighter reliefs.
Key steps to consider:
- Review your Will and estate plan: With IHT thresholds frozen and reliefs capped, small adjustments now could save significant tax later
- Plan property moves strategically: SDLT remains unchanged, but the new high-value property surcharge from 2028 could influence timing for purchases or sales
- Revisit rental income strategy: Higher income tax rates on rents from 2027 mean landlords should assess profitability and explore tax-efficient structures
- Consider lifetime gifts sooner rather than later: Relief caps from 2026 may reduce the benefit of large transfers
- Get expert advice: Our Private Client team can help you navigate these changes and protect your wealth. Contact us on 03456 465 465 or email enquiries@rotherabray.co.uk
Disclaimer: This blog is for information only and does not constitute legal advice. If you need legal advice please contact us on 03456 465 465 or email enquiries@rotherabray.co.uk to get tailored advice specific to your circumstances from our qualified lawyers.
