UK Financial News update
Stories of the week
1. Six million more taxpayers. Same thresholds. Thanks for that.
Analysis of HMRC figures shows there are now 39.1 million income taxpayers in the UK, up 6.1 million since income tax thresholds were frozen in 2021/22. Basic rate taxpayers have risen by 3 million to 30.4 million. Higher rate taxpayers are up 2.65 million to 7.08 million. Additional rate taxpayers have increased by 710,000 to 1.23 million.
Perhaps the most striking figure is the 8.7 million taxpayers over State Pension age, up 29% since the freeze began. The thresholds remain frozen until 2028.
This is what’s known as “fiscal drag.” Wages and prices go up, the thresholds don’t move, and more people get pulled into higher tax bands without any headline tax rise being announced. It’s a stealth increase, and it’s working exactly as intended.
The Wiseones Take
This is the single biggest reason tax-efficient wrappers matter more now than they have in years. Your ISA allowance (still £20,000 for this tax year, so use it) shelters growth from income tax and capital gains tax. Your pension contributions still get tax relief at your marginal rate, which is increasingly likely to be 40% if you’re anywhere near a decent salary.
If you’re retired or approaching retirement, this should be a wake-up call for proper income sequencing. The order in which you draw from your pensions, ISAs, and other savings matters enormously when more of your income is being taxed. Simple things like splitting assets between spouses to make use of both personal allowances can save thousands. And if you’re caught in the 60% tax trap between £100,000 and £125,140 (where you lose your personal allowance), pension contributions are one of the best escape routes going.
Two more years of this silent squeeze. Plan accordingly.
2. One in four ESG funds still at risk of greenwashing. One in four.
MainStreet Partners has released its 2026 ESG & Sustainability Barometer. The headline findings: around 25% of Article 8 funds (those marketed as promoting environmental or social characteristics) still fall below MainStreet’s “ESG-assessed” threshold, putting them at risk of greenwashing.
It’s not just the Article 8 crowd either. About 5% of Article 9 funds (the ones supposed to have sustainable investment as their actual objective) scored below 3.5 on MainStreet’s scale, placing them in the “greenwashing risk” bucket. The report also notes that tightening rules and standards are actually pushing average manager scores down, which tells you the previous bar was probably too low.
The Wiseones Take
“ESG” on the tin doesn’t tell you what’s in the tin. If you’re choosing funds based on their sustainability credentials, whether for your own portfolio or as part of a workplace pension default, you can’t just take the label at face value. You need to understand the process, the objectives, the KPIs the fund is actually targeting, and what it’s actually holding.
This is especially important for anyone involved in pension scheme governance. If your scheme’s default fund range includes ESG options (and it probably does), the question isn’t “does it say ESG on the factsheet?” The question is “can we evidence that this fund does what it says it does?” Because the regulator is paying attention, and so should you.
For individual investors, the message is simpler: do your homework. Or better yet, talk to someone who does homework for a living. A label is not a strategy.
3. Seven finfluencers fined for illegal financial promotions. The fines? Laughable.
The FCA has secured convictions against seven social media influencers for issuing unauthorised financial promotions. The group, who had a combined Instagram following of 4.5 million, were promoting an unauthorised foreign exchange trading scheme. They were sentenced at Southwark Crown Court.
The outcomes:
Lauren Goodger was fined £3,750 plus costs of £5,778.
Biggs Chris got a £600 fine. Jamie Clayton, £820.
Rebecca Gormley received a conditional discharge.
Yazmin Oukhellou was fined £974.
Scott Timlin, £938. And
Eva Zapico received an absolute discharge (which basically means “you did it, but we’re not punishing you”).
Combined fines across all seven: roughly £8,000. For promoting unauthorised financial products to millions of followers. The underlying scheme involved contracts for difference (CFDs) and forex trading, products where the FCA’s own data shows the majority of retail clients lose money.
The Wiseones Take
The fines are tiny. That’s less than most of them probably charged for the Instagram post in the first place. But the precedent matters. The FCA is now prosecuting influencers for illegal financial promotions, and that’s new territory. These aren’t “investment tips from someone who knows.” They’re paid adverts for high-risk products, dressed up as lifestyle content.
If you follow anyone on social media who talks about money, trading, crypto, or “financial freedom,” here’s your checklist. Are they FCA-authorised? (You can check the register at register.fca.org.uk.) Are they being paid to promote the product? (They should disclose this, but many don’t.) Does it sound too good to be true? (It is.)
Social media is not a financial adviser. It’s an advertising platform. And if someone with a million followers and a ring light is telling you about a “can’t lose” forex strategy, the only person who can’t lose is the person being paid to post it.
Rate watch
Bank of England Bank Rate: 3.75% ↔️
UK mortgage rates (typical averages):
2-year fixed (75% LTV): ~4.25% 🔼 0.02%
5-year fixed (75% LTV): ~4.40% 🔼 0.00%
UK GDP +1.3% December 2024 to December 2025
UK Inflation Rates year on year
UK CPI – 3.0% 🔽 0.4%
UK CPIH – 3.2% (including housing costs) 🔽0.2%
UK RPI – 3.8% 🔽0.4%
Upcoming Dates For Your Diary
February 2026
18 Feb 2026 – January inflation data released
March 2026
3 Mar 2026 – UK Spring Forecast + OBR Economic & Fiscal Outlook
8 Mar 2026 – FCA Value for Money consultation closes
19 Mar 2026 – Next Bank of England interest rate decision
Wise Money Tips
(The tax year ends Sun 5 April 2026, but Good Friday is 3 April and Easter Monday is 6 April, so admin cut-offs land earlier.)
Use your “use-it-or-lose-it” ISA allowance: up to £20,000 across ISAs in 2025/26 (frozen until April 2031). Don’t forget JISA £9,000 and LISA £4,000 (also frozen to April 2031).
Dividend tax is rising from 6 April 2026: ordinary rate 8.75% → 10.75% and upper rate 33.75% → 35.75% (additional stays 39.35%). If you hold income shares outside wrappers, consider whether ISA/pension sheltering is worth it.
Top up pensions before year-end (and check carry-forward): the annual allowance is £60,000 for 2025/26 (tapering can apply for higher earners).
VCT timing matters this year: from 6 April 2026, VCT income tax relief drops to 20% (from 30%). VCT relief can’t be carried back, so if you want 2025/26 relief, the subscription needs to be in before year-end (practically by 2 April).
EIS/SEIS investors: unlike VCT, EIS/SEIS relief can usually be carried back to the previous tax year (useful if your tax bill is lumpy).
Use key “small but real” allowances: Personal Savings Allowance (£1,000/£500/£0 depending on band), Marriage Allowance transfer, and the £3,000 annual IHT gifting exemption (resets each tax year).
State Pension uplift from 6 April 2026: full new State Pension rises £230.25 → £241.30/week; basic State Pension £176.45 → £184.90/week
Quick check: NI record (especially age 50+): a top-up year can materially improve your State Pension outcome, it is worth checking your forecast and gaps before you start making irreversible year-end decisions