AJ Bell regulatory outlook: five key topics to dominate 2026

As AJ Bell’s public policy experts Tom Selby and Rachel Vahey explain, 2026 is set to be a watershed year for personal finance. From the rollout of the FCA’s new Targeted Support regime and the redesign of ISAs, to the rise in the state pension age, the arrival of Pensions Dashboards and major changes to workplace pensions, the year ahead will see long-planned reforms finally come to life – reshaping how people save, invest and prepare for retirement.

Ø Launch of Targeted Support: the new tailored guidance option of Targeted Support could begin to be rolled out by firms from April 2026

Ø Design of a new ISA regime: restricting the Cash ISA subscription limit to £12,000 for under 65s will mean designing a new regime for both Cash ISAs and Stocks and Shares ISAs

Ø State pension age starts to rise again: the state pension age will gradually increase from 66 to 67 over a two-year period, starting in April 2026

Ø Pensions Dashboards a step closer to becoming reality: all pension schemes will have to connect to Pensions Dashboards by 31 October 2026

Ø The workplace pensions revolution continues apace: the Pension Schemes Bill will soon receive Royal Assent, kicking off a raft of activity to introduce value for money measures and new guided retirement rules

Launch of targeted support from April 2026

In December 2025, the Financial Conduct Authority (FCA) unveiled final rules enabling financial firms to offer Targeted Support to investors
Under the new regime, which is expected to come into force in April 2026, firms will be able to make suggestions to cohorts of customers aimed at improving their financial situation
In March, the FCA’s authorisations gateway will open to firms applying for permissions to offer Targeted Support

Tom Selby, director of public policy at AJ Bell, comments:

“The FCA is bang on when it says Targeted Support has the potential to revolutionise the help millions of people receive about their finances. Targeted Support will allow firms to help customers make better informed decisions about saving, investing and retiring. This in turn should boost engagement and understanding and give more people a fighting chance of building financial resilience both now and in the future.

“The FCA deserves significant credit for delivering a package of changes, in close consultation with the financial services industry, that have the potential to make a real difference to people’s financial lives.

“In 2026 we turn from planning and talking about change, to seeing it happen in practice. From March, firms can apply to the FCA for permission to offer Targeted Support and should be able to put their plans into action from April.

“However, one sticking point remains. At the moment, Targeted Support is governed by the same rules as marketing communications. But as the number of those opting into receiving marketing communications is as low as 25%, without change there is a real danger a significant number of people will not receive these vital communications aimed at helping them make better-informed decisions. If the government wants the potential benefits of these reforms to be maximised, it needs to address this issue ahead of the April launch date.”

Design of a new ISA regime

The maximum subscription to a Cash ISA will be limited to £12,000 from April 2027 for those under the age of 65
To prevent people from deliberately avoiding these rules, HMRC anticipates making changes to the current ISA regime, such as banning transfers for under 65s from Stocks and Shares ISAs to Cash ISAs
HMRC intend to draft new rules in plenty of time before the April 2027 implementation date
Government to consult in early 2026 on a new simple ISA product aimed at helping first time buyers to eventually replace Lifetime ISAs

Tom Selby, director of public policy at AJ Bell, comments:

“The government has missed a golden opportunity to reshape ISAs with the consumer in mind. Reforms should have been focused squarely on simplifying ISAs to make the ISA landscape easier for ordinary people to navigate, providing flexibility for consumers, rather than adding friction in the form of new allowances and extra complexity.

“If it is intent on pursuing this misguided course of action, then it needs to proceed very carefully. The new rules to prevent people circumventing the cut in the Cash ISA allowance need to be designed to cause the least amount of disruption to the current ISA regime, maintaining ISAs’ simplicity as much as possible and avoiding the imposition of unnecessary tax charges.

“Not content with six different types of ISA, the government also wants to add a new one into the mix which will create further complexity – a new type of ISA aimed at first time buyers.

“Hopefully, the government’s consultation will also cover the future of the Lifetime ISA. It appears that despite having no new customers once the new ISA becomes available, the Lifetime ISA will be around for some time to continue helping current customers realise their property dreams. In that case, it makes sense to change some of the rules – for example the maximum property price – so that it’s fit for purpose now and during the period of transition.”

State pension age set to rise again from April

The state pension age will start to gradually rise from 66 to 67 between April 2026 and March 2028
This transition period affects those born between 6 April 1960 and 5 March 1961
It could mean some people won’t receive their state pension until several months later than anticipated
Those born after 6 April 1960 will have a later state pension age, and should make sure their retirement income plans fit around these dates
Dr Suzy Morrissey is currently preparing an independent report – expected later this year – on the factors that are relevant when the government reviews the state pension age

Tom Selby, director of public policy at AJ Bell, comments:

“The state pension forms the bedrock of most Brits’ retirement income, so it’s naturally important that people know when it can be claimed from.

“Despite increases to the state pension age in the previous decade, some people may have overlooked that it’s once again on the rise. For those born between April 1960 and March 1961, their state pension age will be between 66 and 67. For those born later, their state pension age will be 67, although this is scheduled to increase to 68 in the mid 2040s.

“Some people may find they have to work a few more months before they can claim this important source of income, or that they have to use private income to bridge the gap before it kicks in.

“But this is unlikely to be the end of increases in the state pension age. The government has to review the state pension age from time-to-time, and last year asked Dr Suzy Morrissey to outline what factors need to be considered in that review. She should deliver her report in 2026, setting the framework for how the state pension age should rise in the future.”

Pensions Dashboards a step closer to becoming reality

All pension schemes are legally required to connect to Pensions Dashboards by 31 October 2026
Most FCA-regulated schemes and large workplace pension schemes are already connected
Once the DWP is satisfied that most people’s pensions can be found on the dashboard, and that it is providing an excellent customer service, it will announce the launch date for the first dashboard offered through MoneyHelper
The DWP has to give pension schemes six months’ notice of this date

Rachel Vahey, head of public policy at AJ Bell, comments:

“After being on the drawing board for what seems like an eternity, Pensions Dashboards will this year take an important step forward to becoming a reality.

“Most big pension schemes are now connected to Pensions Dashboards, and have moved into the testing phase, making sure they are able to find and return information to users on what pension schemes they have, what income they could receive, and from when.

“The next big milestone is for the DWP to announce the launch date for the MoneyHelper dashboard. It will only do that once it is satisfied the system is working well, and that users are getting the right information and understand what it means for them.

“Dashboards have the potential to be a game changer for those who want to take control of their pension savings. Once up and running they will give people the confidence to find those missing pensions, face up to their pension planning and make decisions to secure themselves a brighter financial future.”

The workplace pensions revolution continues apace

The Pension Schemes Bill will soon receive Royal Assent, whilst government and regulators continue work on other policy measures aimed at improving outcomes for members of workplace pensions
Workplace pensions have until 2030 to ensure their default funds meet the minimum size requirements or take alternative action
The FCA and DWP issued a further consultation paper on value for money in workplace pensions on 8 January
The DWP and FCA are developing guided retirement rules, outlining how workplace pensions should offer retirement options to their members in future
In 2026, the Pension Commission will also issue its interim report, and its final report in early 2027

Rachel Vahey, head of public policy at AJ Bell, comments:

“The changes coming to workplace pensions are not slowing down. Once the new Pension Schemes Bill becomes law, the workplace pension market will start getting ready for the new world of pension megafunds coming in 2030. This means default pension funds – the ones most employees are automatically put into on joining a new employer – will need to be at least £25 billion in size. As a result, some well-known workplace pension providers will face big changes and difficult choices to make sure they meet these new rules.

“But alongside this massive change, there is a whole raft of other measures on the design board.

“New value for money regulations will push those schemes that aren’t up to the grade into consolidating with or moving to other arrangements. Whereas consolidation on a small scale is on the table for those people with stranded small pension pots.

“The DWP and regulators are also keen to tackle improving the retirement options for pension savers, including offering workplace pension members a default retirement solution.

“All this activity is taking place against the backdrop of a second Pension Commission launched last year to map out a path to a pensions system that ensures people have adequate pension savings. But don’t expect fireworks. The Commission is following a narrow brief, for example it won’t recommend changes to state pension age or the triple lock, nor is it likely to suggest changes to the pensions tax rules.

“However, its findings will still be significant in setting pension policy. But to make a real difference, it needs to paint the full picture. We hope it looks beyond workplace pensions to property and other savings, as well as considering the impact on the self-employed of phasing out the Lifetime ISA.”

DIARY

This is a summary of key policy and regulatory developments expected this year and beyond. Dates are correct at the time of publishing but are subject to change according to updates issued by regulators, government departments and other relevant bodies.

What	When	Who	AJ Bell View
First quarter of 2026
FCA consultation on Simplified Advice	January 2026	FCA
House of Lords Finance Sub-Committee’s publishes report following its call for evidence on the Finance Bill clauses, in particular IHT on pensions	Early 2026	House of Lords	House of Lords to scrutinise plans to impose IHT on pensions as it launches call for evidence
Pension Schemes Bill receives Royal Assent	Early 2026	DWP	Government promises sweeping changes for pension scheme savers under the pension schemes bill
FCA consultation on simplified advice, running parallel to development of Targeted Support	Early 2026	FCA
HMRC to consult on new ISA product aimed at first time house buyers to replace Lifetime ISA	Early 2026	HMRC	Government to launch consultation on future of Lifetime ISA
FCA consultation CP25-39 on adapting our requirements for a changing pensions market closes	12 February 2026	FCA
FCA Authorisations Gateway for Targeted Support opens	March 2026	FCA	FCA confirms ‘game changing’ Targeted Support reforms to boost help for investors
FCA to consult on proposals for SIPP regulatory framework	Q1	FCA
FCA to consult on changes to its ongoing advice charge rules	Q1	FCA
APPG to publish written report on pension income in retirement inquiry, including recommendations	Q1	APPG
Second quarter of 2026
Dividend tax rates to increase to 10.75% (ordinary) and 3.5.75% (upper). The additional rate will remain at 39.35%	6 April 2026		Investors brace for dividend tax increase
Business Asset Disposal Relief (BADR) for capital gains tax to rise to 18%	6 April 2026	HMRC
New IHT rules including combined agricultural and business property £2.5 million limit for 100% relief from IHT, and 50% relief thereafter	6 April 2026	HMRC	IHT reforms spark death tax raid on small businesses and landowners Government backs down on IHT plans for farmers and businesses
VCT tax relief reduces from 30% to 20%	6 April 2026	HMT
Targeted Support rules take effect	6 April 2026	FCA	FCA confirms ‘game changing’ Targeted Support reforms to boost help for investors
Start of the transition to CCI disclosure	6 April 2026	FCA	FCA urged to stick with principles-based regulation on investment disclosure
SPA to start to increase to 67	Between 6 April 2026 – 5 April 2028	DWP	Could the state pension age increase to 68 in the 2030s?
Possible we could receive final rules on new regime for ISAs to start in April 2027	April 2026		Cash ISA allowance cut as Reeves bids to boost investing
Independent Review of planned State Pension Age to be published	May 2026	DWP	Could the state pension age increase to 68 in the 2030s?
Pension Commission Interim Report is published	Spring 2026	Pension Commission	Government revives Pension Commission to tackle long-term retirement under-saving crisis and sustainability of state pension
Second half of 2026
HMRC expected to publish draft information sharing regulations relating to bringing pensions into IHT	Summer 2026	HMRC	AJ Bell urges government to go back to drawing board on IHT proposals Budget tweak to IHT on pensions process could ease admin agony
FCA publish final rules on tools and modellers and new pension transfer information gathering	Summer 2026	HMRC
DWP and FCA consultation on Guided Retirement	H2 2026	DWP/FCA	Government promises sweeping changes for pension scheme savers under the pension schemes bill
FCA could publish update on authorisation process for a firm to apply to be a pensions dashboard service firm	Possibly H2 2026	FCA
Final connection deadline for pensions dashboards	31 October 2026	DWP	FCA confirms commercial Pensions Dashboards rules but firms in the dark on timescale for delivery AJ Bell Launches Free Pension Finding Tool to Track Down the UK’s £26bn Lost Retirement Savings
FCA publishes Final Value for Money rules	Q4 2026	FCA	New rules aim to simplify value for money in workplace pensions
2027
MoneyHelper version of Pensions Dashboard could launch	Early 2027	MaPS
Pensions Commission issue final report on pensions adequacy	Early 2027		Government revives Pension Commission to tackle long-term retirement under-saving crisis and sustainability of state pension
Mastertrusts start complying with Guided Retirement	H1 2027	DWP	Government promises sweeping changes for pension scheme savers under the pension schemes bill
Cash ISA subscription allowance reduced to £12,000 for 18-64 year olds	6 April 2027	HMT	Cash ISA allowance cut as Reeves bids to boost investing
New rules for Stocks and Shares ISAs and IFISAs: restricting transfer to Cash ISAs; introducing test on investments, and introducing charge on interest paid on cash investments	6 April 2027	HMT
Unused pensions to be included in the estate for IHT	6 April 2027	HMT	AJ Bell urges government to go back to drawing board on IHT proposals Budget tweak to IHT on pensions process could ease admin agony
New rates of savings income tax – 22%/42%/47%	6 April 2027	HMT	Savers hit with tax rise on cash interest
New rates of property income tax – 22%/42%/47%	6 April 2027	HMT
End of period of transition, and start of new CCI disclosure rules	8 June 2027	FCA	FCA urged to stick with principles-based regulation on investment disclosure
2028 and 2029
FCA to conduct a post implementation review of Targeted Support within two years, considering how many firms offer, customer uptake and products being suggested.	By March 2028	FCA	FCA confirms ‘game changing’ Targeted Support reforms to boost help for investors
GPPs start complying with Guided Retirement	H1 2028	FCA	Government promises sweeping changes for pension scheme savers under the pension schemes bill
Introduction of High Value Council Tax Charge (aka Mansion Tax)	6 April 2028	HMT
NMPA rises to 57 (unless protected)	6 April 2028	HMRC
First publication of Value for Money assessments	Mid-2028	FCA/DWP	New rules aim to simplify value for money in workplace pensions
Small pots consolidators selected	2029	DWP	Government promises sweeping changes for pension scheme savers under the pension schemes bill
The final Child Trust Funds mature	2 Jan 2029	HMRC	Government urges 758,000 young people to come forward and claim over £1.5 billion in lost CTFs
New pensions salary sacrifice threshold of £2,000 takes effect	6 April 2029	HMT	Employers to pay the price as cap on pension salary sacrifice announced in Budget
Last date for UK General Election	June – July 2029	UK Parliament
Later on
Deadline for mastertrusts and GPPs to reach £25bn	April 2030	DWP	Government promises sweeping changes for pension scheme savers under the pension schemes bill
ISA annual subscription to remain frozen at £20,000 until	5 April 2030	HMRC
Small pots consolidation comes into force	2030	DWP	Government promises sweeping changes for pension scheme savers under the pension schemes bill
Income tax thresholds for rest of UK to remain frozen until	5 April 2031	HMT	The Reeves Freeze: how much frozen income tax bands will cost you
IHT nil rate band and residence nil rate band to remain frozen until	5 April 2031	HMT	How IHT doubled in a decade, with Labour’s death tax raid set to slash reliefs and exemptions from next year