If you’re a saver in the UK then you’ll find some changes to your savings accounts in the Budget 2025. The overall annual Individual Savings Account (ISA) limit remains at £20,000 per year, however changes are on the way from April 2027 with those under 65 limited as to the amount that can be invested in a cash ISA.
Savings income will be subject to higher rates of tax with a 2% increase in the basic, higher and additional rates from April 2027.
Individual Savings Accounts (ISAs) for Savers
Income received within an ISA product is exempt from income tax. This includes both cash and stocks and shares ISAs. The limit on how much you can save into ISAs in 2026/27 remains at £20,000 overall. From 6 April 2027, the annual ISA cash limit will be set at £12,000, within the overall annual ISA limit of £20,000.
Savers over the age of 65 will continue to be able to save up to £20,000 in a cash ISA each year.
Tax relief for pension contributions
Income tax relief is generally given in full for qualifying pension contributions, meaning that they are an important component for many savers in their tax planning exercises.
Child Benefit and the High-Income Child Benefit Charge (HICBC)
You may have to pay the HICBC if your income exceeds £60,000 and child benefit is being paid in relation to a child that lives with you, regardless of whether you are a parent of that child. If you are living with another person in a marriage, civil partnership or longterm relationship, you will only be liable for the HICBC if you are the higher earner of the two of you.
For 2026/27, the HICBC continues to be calculated at 1% of the child benefit received for every £200 of income above £60,000. This means that for many savers, child benefit is fully clawed back where income exceeds £80,000.
If you have any questions about the impact of the Budget 2025 changes on your savings, please get in touch with our team.