March 2026 – Spring Statement

Today’s Spring Statement 2026 was designed to be “low-key,” focusing on stability rather than big new tax announcements. However, it confirmed a wave of significant changes arriving in just five weeks (April 6, 2026). Here is how the 2026 landscape shifts for different walks of life:

Families & Households

• Energy Bills: A typical household will see £150 cut from their annual energy bills starting in April as
  “green levies” are moved to general taxation.
• The Two-Child Cap: In a major move for larger families, the two-child benefit limit is abolished from
  April 2026, meaning Universal Credit will now support every child in a household.
• Childcare: Eligible working parents can now access up to 30 hours of free childcare for children as
  young as 9 months.
• Prescriptions: Costs remain frozen at under £10 for the 2026/27 year to help with health costs.

Workers & The Employed

• Pay Rise: The National Living Wage increases in April to a new record high, giving full-time workers
  on that rate an annual boost of roughly £900.
• The “Stealth Tax”: Because tax thresholds are still frozen, a pay rise might push you into a higher tax bracket (fiscal drag). If you earn near £50k or £125k, you may notice a larger chunk of your raise going to the taxman.
• Commuting: Rail fares have been frozen across England for 2026—the first time this has happened in 30 years.

Pensioners

• Triple Lock Boost: The State Pension will rise by 4.8% in April 2026, bringing the full New State
  Pension to roughly £241.30 per week (£12,547.60 a year).
• Tax Trap Warning: Because the State Pension is rising while the Personal Allowance (£12,570) stays
  frozen, thousands of pensioners with even small private pensions will start paying income tax for the first time this year.
• Direct Support: The DWP confirmed a £500 targeted boost for the most vulnerable pensioners (those on Pension Credit) via local authorities.

Business Owners & Investors

• Dividend Tax: Investors and directors will see dividend tax rates rise by 2% in April.
• Business Rates: Small businesses in the retail, hospitality, and leisure sectors will benefit from a new permanent discount, while pubs and music venues get an extra 15% relief.
• Inheritance Tax: New caps on business and agricultural relief take effect in April. The first £1 million
  of combined relief remains at 100%, but anything above that is taxed at 50%.

Disclaimer: This summary is for information purposes only and does not constitute professional financial, tax, or legal advice. While every effort has been made to ensure accuracy based on the Spring Statement (March 3, 2026), tax legislation is subject to change. We recommend seeking professional advice tailored to your individual circumstances before taking any action