The Autumn Budget 2025 brought a mix of changes for savers and investors. In particular, ISAs and investment rules for younger adults, first-time buyers, lower-income households and growth companies are being reshaped over the next few years. ISA allowances will work differently for under-65s, Help to Save is being expanded, and there are important updates for pensions, VCTs and EIS.
Here is what has been announced and when it is due to take effect.
ISA allowances and the new cash cap
For 2026/27, ISA limits themselves remain the same:
- Overall ISA subscription limit: £20,000
- Lifetime ISA (LISA) limit: £4,000
- Junior ISA and Child Trust Fund limit: £9,000
However, from 6 April 2027, the way under-65s can use that allowance will change. A new cap on cash ISAs will apply:
- The maximum annual cash ISA subscription will be £12,000 for those aged under 65.
The overall allowance of £20,000 does not change. Instead, anyone under 65 who wants to use the full allowance will need to place at least £8,000 into stocks and shares or other qualifying investments, rather than keeping the entire amount in cash. Those aged 65 and over will not be subject to this new cash cap.
These changes mean that ISAs and investment rules now push younger savers more firmly towards invested solutions rather than large cash balances.
A new ISA for first-time buyers
Support for first-time buyers is also being redesigned.
In early 2026, the government will publish a consultation on a new, simpler ISA product aimed at people buying their first home. Once this new ISA is introduced, it will replace the Lifetime ISA.
The detail of how this transition will work is still to come. Existing LISA holders, and advisers who work with them, will need to watch the consultation and eventual rules so they can decide how best to manage current accounts and future contributions.
Help to Save: made permanent and widened
The Budget confirmed that the existing Help to Save scheme will be made permanent. This scheme rewards regular saving by offering a government bonus to eligible lower-income households.
From 6 April 2028, eligibility will be extended. In addition to current criteria, it will include all Universal Credit claimants who receive:
- the child element,
- the caring element,
- or both.
As a result, more families on Universal Credit will be able to build a savings buffer with government support, which should improve resilience for those on lower incomes.
Pension salary sacrifice and investing for retirement
Although ISAs are a major part of personal savings, pensions remain the main long-term retirement vehicle. The Budget therefore also highlighted a key change to pension salary sacrifice arrangements.
From 6 April 2029, employer and employee National Insurance contributions (NICs) will be charged on pension contributions above £2,000 a year that are made via salary sacrifice.
In effect:
- The first £2,000 a year of salary-sacrifice pension contributions will still benefit from the NIC saving.
- Any contributions above £2,000 made through salary sacrifice will no longer avoid NICs and will instead be subject to NICs in the usual way.
The income tax relief on pension contributions is not being changed here. What is being reduced is the extra NIC advantage that salary sacrifice currently offers for larger pension funding.
The summary also includes this reminder:
“Investing in pensions. Remember the annual allowance is £60,000, so you may be able to make larger pension contributions while the salary sacrifice opportunity remains.”
For many higher earners, there is therefore a planning window between now and April 2029 to review pension contributions, within the £60,000 annual allowance and subject to tapering rules.
State pension and simple assessment
Alongside ISAs and pensions, the Budget also touched on how small amounts of tax are collected from some pensioners.
From 2027/28:
Pensioners whose sole income is the basic or new state pension (without any increments) will not have to pay small amounts of tax through simple assessment if their state pension exceeds the personal allowance.
Currently, if the state pension exceeds the personal allowance, HMRC can issue a simple assessment to collect the tax due. The change is intended to remove this extra administrative step for pensioners whose only income is the standard state pension. More detail about how this will work in practice is expected next year.
UK listing relief for newly listed companies
To make the UK a more attractive place for companies to list, a new UK listing relief is being introduced.
From 27 November 2025, transfers of a company’s securities will qualify for relief from the 0.5% stamp duty reserve tax charge for three years after the company lists on a UK regulated market.
This reduces transaction costs for investors and is intended to support capital raising by newly listed UK companies in their early years on the market.
VCT and EIS changes: relief levels and limits
The Budget also contained several changes for Venture Capital Trusts (VCTs) and the Enterprise Investment Scheme (EIS), both of which are designed to channel investment into smaller, higher-risk companies.
From 2026/27:
- The rate of VCT income tax relief will decrease to 20%, down from the current 30%.
At the same time, the investment limits and company size thresholds are being increased, especially for knowledge intensive companies (KICs):
- The VCT and EIS company investment limit will rise to £10 million for standard companies and £20 million for KICs.
- The lifetime investment limit for companies will increase to £24 million for standard companies and £40 million for KICs.
- From April 2026, the gross assets test will increase to £30 million before a share issue and £35 million after.
These changes mean individual investors will receive a lower rate of income tax relief on VCT investments. However, companies that qualify, particularly knowledge intensive firms, will be able to access larger funding packages under the VCT and EIS regimes.
What these ISAs and investment rules mean for you
Overall, the Autumn Budget 2025 creates a more targeted environment for ISAs and investment rules:
- Under-65s must balance cash and invested ISAs more carefully if they want to use the full £20,000 allowance.
- First-time buyers will see the Lifetime ISA replaced by a new, dedicated ISA product in due course.
- More lower-income households will have access to a permanent Help to Save scheme.
- Pension savers using salary sacrifice should be aware of the £2,000 NIC cap from April 2029.
- Investors using VCTs and EIS will see relief rates fall but company funding limits rise.
For a detailed breakdown of the Budget’s key components, you can view the full document here.