Spring Statement 2025 — Key Points for High Earners

The Spring Statement 2025, delivered by the Chancellor on 26 March, confirmed that the government will make no changes to income tax thresholds for the 2025/26 tax year. The personal allowance remains at £12,570, the higher-rate threshold stays at £50,270, and the additional-rate threshold is unchanged at £125,140. For high earners, this means the punitive £100k–£125,140 taper zone continues to impose an effective 60% marginal tax rate as the personal allowance is progressively withdrawn.

Employer National Insurance Contributions rose to 15% from April 2025, with the secondary threshold dropping from £9,100 to £5,000. This represents a significant increase in employment costs for businesses, and it materially changes the value proposition of salary sacrifice arrangements. Where an employer passes on the NIC savings from a sacrifice scheme, the combined benefit to employee and employer is now greater than in previous years. High earners exploring pension sacrifice strategies may wish to factor in this enhanced saving when modelling their options.

The statement also confirmed continued investment in HMRC's compliance activities, with additional funding for tax avoidance and evasion enforcement. For individuals with complex remuneration structures — including those using multiple salary sacrifice arrangements, share options, or carried interest — this underscores the importance of ensuring all tax planning is fully compliant and well-documented. The OBR's updated forecasts project slightly lower growth than previously anticipated, which may influence future fiscal decisions.