The Spring Statemtent 2026: Pensions & Investments

Whilst the world around us may be in turmoil and as the UK approaches the end of the tax year with perhaps a feeling of intrepidation, we’re highlighting some of the main points arising from the Chancellor’s recent Spring Statement. And in this post, we take a look at those all-important pensions and tax-efficient investments. 

Pensions

For 2026/27, the limits are as follows:

• The Annual Allowance (AA) is £60,000.
• Individuals who have ‘threshold income’ for a tax year of greater than £200,000 have their AA for that tax year restricted. It is reduced by £1 for every £2 of ‘adjusted income’ over £260,000, to a minimum AA of £10,000.
• The Pension Commencement Lump Sum Allowance, which relates to the general maximum that may be able to be taken as a tax-free lump sum, is £268,275.

There had been much speculation that some of the above limits would be reduced or that the amount of tax free lump sum would be cut but such changes did not happen.

Tax-Efficient Investments

Individual Savings Accounts (“ISAs”)

For 2026/27, the limits are as follows: 

• Individual Savings Accounts (ISAs) £20,000
• Junior ISAs £9,000
• Lifetime ISAs £4,000 (excluding government bonus)
• Child Trust Funds £9,000.

These limits will remain frozen until 5 April 2031.

From 6 April 2027, the annual ISA cash limit will be set at £12,000. The remaining £8,000 will be designated for stocks and shares ISA investment. This restriction will not apply for those over the age of 65, where the cash ISA limit will remain at £20,000.

This change had been widely trailed by the government. It appears as though the government wishes more people to use their ISA allowance on shares rather than cash, so this seems to be an attempt to ‘force’ that change.

However, with the volatility that can arise with stocks and shares, quite whether this change will have the desired effect remains to be seen.

Enterprise Investment Scheme and Venture Capital Trusts investment limit increase and restructure

The government has announced significant changes to the limits applying to the Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCTs) from 6 April 2026. The gross assets requirement that a company must not exceed for EIS and VCTs will increase from £15 million to £30 million immediately before the issue of the shares, and from £16 million to £35 million immediately after the issue. The annual investment limit that companies can raise will increase from £5 million to £10 million. 

For Knowledge-Intensive Companies (KICs), the annual investment limit will increase from £10 million to £20 million. 

The company’s lifetime investment limit will increase to £24 million and for KICs to £40 million. The Income Tax relief that can be claimed by an individual investing in VCTs will decrease from 30% to 20%.

Expanding the eligibility limits of the Enterprise Management Incentives scheme 

The government is also increasing certain limits relating to the Enterprise Management Incentives (EMI) scheme. For EMI contracts granted on or after 6 April 2026, the employee limit will increase from 250 employees to 500 employees, the gross assets test will be increased from £30 million to £120 million, and the company share option limit will be increased from £3 million to £6 million. The limit on the exercise period will increase to 15 years, and will also apply retrospectively to existing EMI contracts which have not already expired or been exercised.

Next steps

As always, these articles provide an overview of the various measures available, and no action should be taken without seeking professional advice.  At Ritchie Phillips, we pride ourselves on providing clear, pragmatic advice to help businesses, individuals and families. If you’d like to discuss any of the above, please get in touch.