Contractors on Alert: Autumn Budget 2025 Set for November 26
Autumn Budget 2025 Confirmed for 26 November: Contractors Urged to Prepare
The Chancellor of the Exchequer, Rachel Reeves, has confirmed that the Autumn Budget 2025 will take place on Tuesday, 26 November. The date was announced through an official HM Treasury video published on YouTube.
Announcement by HM Treasury
The announcement was made in an unconventional format, with the Chancellor appearing in a short film filmed at 11 Downing Street. While light in tone, the content of the video will not distract contractors from the seriousness of the forthcoming Budget, with many expecting measures that could have a significant financial impact.
Income Tax Thresholds and Fiscal Drag
According to Dan Mepham, managing director of SG Accounting, contractors should be prepared for the likelihood of another freeze in income tax thresholds. He noted that such a move would be a straightforward way for the government to increase revenue without altering headline tax rates.
Mepham also suggested that the Chancellor may explore reforms to property and council tax, wealth taxation, Capital Gains Tax, Inheritance Tax, and ISAs. He emphasised that the scope for revenue-raising measures is broad and that contractors should anticipate further fiscal drag.
Concerns About Fiscal Promises
Other experts have questioned whether Labour’s manifesto commitments on taxation remain sustainable. Michael McCullion of Bright Ideas Accountancy highlighted the large deficit in public finances, estimated at £20–50 billion, and warned that campaign pledges could be compromised. He also raised the possibility of a reduction to the current £90,000 VAT registration threshold and the potential reintroduction of higher National Insurance contributions.
Employers continue to report that the tax increases announced in last year’s Autumn Statement are weighing on recruitment, with the Office for Budget Responsibility estimating an additional average annual cost of more than £800 per employee.
Employment Status and Tax Reform
Meredith McCammond, technical officer at the Low Incomes Tax Reform Group, said that while Reeves acknowledged in her announcement that the economy “is not working well for enough working people,” more substantive reform is needed. She urged the government to address employment status for tax purposes in parallel with any changes to employment law, stressing the importance of aligning the two frameworks.
IR35 and Contractor Status
Seb Maley, CEO of Qdos, assessed the chances of IR35 reform being addressed in this Budget at “three out of ten.” While unlikely, he noted that contractors’ priority remains ensuring fair and accurate IR35 assessments, with an end to the practice of blanket determinations that wrongly classify independent workers. Maley reiterated that contractors working inside IR35 are in effect “zero-rights employees” — taxed as employees but without the associated protections.
Maley added that the umbrella company market is likely to be the government’s immediate focus, with regulation expected to arrive in the coming years. Corporation tax is another concern for limited company contractors, but Mepham advised that no significant changes should be expected in November.
Making Tax Digital
Looking ahead to April 2026, McCammond raised concerns over the rollout of HMRC’s Making Tax Digital (MTD) programme for the self-employed. She urged the Chancellor to introduce a soft-landing period or consider delaying penalty provisions to allow businesses time to adapt.
Stamp Duty Land Tax
Finally, Mepham suggested that Stamp Duty Land Tax (SDLT) is unlikely to be targeted in the upcoming Budget, following reports of political sensitivities surrounding the issue.
Conclusion
With less than three months to go, contractors face a period of uncertainty. The Autumn Budget 2025 will be shaped by the government’s need to balance fiscal discipline with economic growth, but contractors should prepare for measures that could tighten their financial position rather than ease it.
