UK: Tax measures in Autumn Budget 2025 include changes to Pillar Two rules and transfer pricing, DST, and DPT reform
A summary of the key tax changes
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December 1, 2025
The Autumn Budget 2025, which was announced on November 26, 2025, includes tax measures of interest to businesses relating to:
- Corporation tax rate
- Capital allowances
- Corporation tax late filing penalties
- International controlled transactions schedule
- Business rates
- Stamp duty reserve tax—UK listing relief
- Enterprise incentive scheme (EIS) and venture capital trusts (VCT) limits
- Transfer pricing—medium-sized enterprises
- Reform of transfer pricing, permanent establishment (PE), and diverted profits tax (DPT)
- Multinational and domestic top-up tax (Pillar Two)
- Digital services tax (DST) review
- Corporate interest restriction
- Creative industries and research and development (R&D) expenditure credits
- R&D tax relief advance clearances
- Advance tax certainty for major projects
- Betting and gaming duties
- Private hire vehicle operators (PHVOs)
- Behavioral penalties reform
- Oil and gas sector
- Cross-border value added tax (VAT) grouping amendment
- Cryptoasset reporting framework (CARF) extension to UK residents
- Modernization of stamp taxes on shares framework
- Local government pension scheme reform—stamp duty land tax relief
- Interest on reversed controlled foreign company (CFC) state aid recoveries
- Carbon border adjustment mechanism (CBAM)
- Low-value imports (LVI) relief
- Soft drinks industry levy (SDIL)
- Annual tax on enveloped dwellings (ATED)
- Fuel duty
- Air passenger duty
- Climate change levy (CCL)
- Landfill tax
- Alcohol duty
- Tobacco duty
- Deposit return schemes (DRS)
- VAT charity tax relief
- Promoters of tax avoidance schemes
- Securitization anti-avoidance
- Economic crime levy
- Changes to charity tax rules
- Overnight visitor levy
- Electric vehicles
- Motability scheme
- VAT treatment of land intended for social housing
- Vaping products duty (VPD)
- Plastic packaging tax (PPT)
- Updates to penalty regime for VAT
- Electronic invoicing (e-invoicing)
- Following consultation
- Refunds of VAT for combined county authorities
- Vehicle excise duty
- Expansion of tax conditionality to granting licenses to new sectors
The budget also includes various measures relevant to employers and individuals.
Read a November 2025 report prepared by the KPMG member firm in the United Kingdom
Further information on and analysis of the Autumn Budget 2025 from the KPMG member firm in the United Kingdom can be found here
For more information, contact a KPMG tax professional:
Tim Sarson | tim.sarson@kpmg.co.uk