03 December 2025
The Chancellor has announced that the tax threshold freeze will be extended until 2030-31 despite the Labour Government initially vowing not to extend the freeze on the personal tax and National Insurance Contributions (NICs) thresholds beyond 2028-29:
“The Government will not extend the freeze to income tax and National Insurance contributions thresholds. From April 2028, these personal tax thresholds will be uprated in line with inflation.”
The typical tax-free personal allowance has remained at £12,570 since 2021, and as stated today, will not only remain frozen until 2028, but has now been extended to 2030–31.
This is often referred to as a ‘stealth’ tax, because as wages increase, more workers will find themselves paying higher amounts of tax.
Please remember that devolved nations have partial income tax powers. Scotland currently set their own rates and thresholds. Wales currently remain in parity with the rest of the UK. We will update you further when the Scotish and Welsh budgets are announced.
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