The Financial Services Compensation Scheme (FSCS) has raised its savings guarantee for bank deposits, increasing the deposit protection limit from £85,000 to £120,000 per person. This change came into effect on 1 December 2025 and marks a significant increase in how your bank deposits are protected in the UK.

This new deposit protection limit ensures that qualifying UK bank and building society depositors are covered if their bank fails. The FSCS compensation limit is reviewed periodically by the Prudential Regulation Authority (PRA). Following a consultation in March 2025, the PRA confirmed the increase in November 2025. Prior to this, the £85,000 limit had been in place since January 2017.

The FSCS protection applies per person, per bank or building society, which means joint account holders are eligible for double the protection, or up to £240,000 in total. In addition, savers with certain types of temporary high balances such as proceeds from a house sale, insurance payouts or inheritances can also benefit from increased protection. This limit has increased from £1 million to £1.4 million per depositor per life event. This additional coverage is available for up to six months.

For most savers, the new £120,000 limit will provide adequate protection. However, those with deposits exceeding this amount should consider spreading their savings across multiple banks or building societies to ensure all their funds are covered. It is important to note that if you hold multiple accounts within a single banking group (i.e., banks that share the same banking licence), the £120,000 limit applies to the total amount across all accounts within that banking group, not to each individual account.

You do not need to take any action to benefit from the increased protection. If your bank or building society were to fail, the FSCS would automatically compensate you up to the new limits.

As we look ahead to 2026, there is growing speculation about how the Bank of England will manage interest rates during what many economists believe will be a period of calmer inflation, steadier wage growth and a more predictable economic backdrop. After several years shaped by sharp price rises, supply chain shocks and policy responses that required rapid increases to the Bank Rate, the outlook for the coming year appears more settled and this is creating a sense that borrowing costs may edge downwards rather than upwards.

The current Bank Rate stands at around four per cent following a series of cuts through 2024 and 2025 as inflation eased gradually. Policymakers have indicated that they remain alert to any resurgence in inflationary pressure, yet they also recognise that the period of high inflation is now behind us. If this trend continues and inflation drifts closer to the Bank’s long term target, it will give the Monetary Policy Committee more room to make modest reductions during 2026. Many forecasters expect something in the region of a quarter to half a percentage point of cuts during the year, although the timing will depend heavily on the data released each quarter.

For households and businesses, this would create a slightly more comfortable lending environment. Mortgage borrowers on variable deals may feel some relief as repayments fall a little and businesses that rely on flexible credit facilities could find that their financing costs ease. Fixed mortgage rates may also become more attractive if lenders anticipate further gradual reductions. However, the broader economic impact is unlikely to be dramatic, since the Bank is not expected to deliver large or rapid cuts. The emphasis is more likely to remain on steady adjustments that avoid disrupting confidence or encouraging excessive borrowing.

It is worth noting that a full return to the ultra-low interest rate environment seen before the pandemic is not expected. Structural changes in the UK economy, global supply conditions and the government’s fiscal position all point towards a future in which interest rates remain higher than the levels seen in the decade prior to 2020. Even so, a move towards slightly lower borrowing costs in 2026 would be consistent with a maturing recovery and a gradual balancing of supply and demand across the economy.

Overall, the most probable outcome for 2026 is a measured reduction in interest rates that supports economic stability without risking a renewed surge in inflation.

The daily charge for driving within the London Congestion Charge zone will rise from £15 to £18 from 2 January 2026. This is the first increase in several years and forms part of Transport for London’s wider plan to manage traffic levels, improve air quality and support sustainable travel across the capital.

Transport for London has said that without an updated charge the central zone is likely to experience a noticeable increase in vehicle volumes during the next year. The higher charge is intended to discourage unnecessary journeys, smooth traffic flow and reduce delays that affect both businesses and individuals.

A significant change for drivers of electric vehicles is also being introduced. The current 100% discount for electric cars will end on 25 December 2025. From January 2026 electric cars registered for Auto Pay will move to a reduced rate that reflects a new tiered discount structure. Electric vans, heavy goods vehicles and quadricycles will also have revised discounted rates. This marks a shift away from the long-standing full exemption that has been used to encourage uptake of electric vehicles.

Residents who live within the congestion charging zone will continue to receive a 90% discount, although new applicants from March 2027 will only qualify for this reduction if they drive an electric vehicle. Existing residents with the discount will keep their entitlement regardless of vehicle type.

For business owners, delivery companies and anyone regularly travelling into central London, these changes will require some forward planning. Vehicle choice, travel habits and the cost of regular visits to the zone may all be affected. It may be useful to review travel arrangements ahead of the January 2026 increase in order to understand the cost impact on budgets and operations.

HMRC offers a helpful online tool that allows agents and taxpayers to check when they can expect a response to a query or request that they have made. The online tool is updated weekly with the latest information.

The full list of taxes the tool can currently be used for are as follows:

• Child Benefit
• Corporation Tax
• Construction Industry Scheme (CIS)
• Employers’ PAYE
• Income Tax
• National Insurance
• Self-assessment
• Tax credits
• VAT

Agents can also check how long it will take HMRC to:

• register you as an agent to use HMRC online services;
• process an application for authority to act on behalf of a client; and
• amend your agent details.

The online tool can be accessed at the following address, and you do not have to be logged in to receive an answer: https://www.tax.service.gov.uk/guidance/Check-when-you-can-expect-a-reply-from-HMRC/start/are-you-an-agent.

The free HMRC tax app now provides quick access to tax codes, income history, self-assessment details, National Insurance records and even payment options, all from your phone.

HMRC’s free tax app is available to download from the App Store for iOS and from the Google Play Store for Android. The latest version of the app includes some updated functionality.

To set up the tax app for the first time, open the app and enter your Government Gateway user ID and password. If you do not have a user ID, you can create one within the app. After signing in, you can access the app easily using a 6-digit PIN, fingerprint or facial recognition.

The app can be used to see your:

• tax code and National Insurance number
• income and benefits
• employment and income history in the previous 5 years
• Unique Taxpayer Reference (UTR) for self-assessment
• self-assessment tax you owe
• your Child Benefit
• your State Pension forecast
• gaps in National Insurance contributions

The app can also be used to complete a number of tasks that usually require the user to be logged on to a computer. This includes to:

• get an estimate of the tax you need to pay
• make a self-assessment payment
• make a Simple Assessment payment
• set a reminder to make a self-assessment payment
• access your Help to Save account
• using HMRC’s tax calculator to work out your take home pay after Income Tax and National Insurance deductions
• track forms and letters you have sent to HMRC
• claim a refund if you have paid too much tax
• ask HMRC’s digital assistant for help and information
• update your name and / or postal address
• save your National Insurance number to your digital wallet
• check if you can make a payment for gaps in your National Insurance contributions
• choose to be contacted by HMRC electronically, instead of by letter.