diff --git a/changelog_entry.yaml b/changelog_entry.yaml
index 7896c1731..e5b5992b4 100644
--- a/changelog_entry.yaml
+++ b/changelog_entry.yaml
@@ -1,4 +1,4 @@
 - bump: patch
   changes:
     changed:
-      - Calibrate savings income from ONS National Accounts D.41g household interest data instead of SPI (fixes underestimation from ~£3bn to ~£55bn)
+      - Calibrate savings income from ONS National Accounts D.41g household interest data instead of SPI (fixes underestimation from ~3bn to ~55bn)
diff --git a/policyengine_uk_data/tests/test_changelog_encoding.py b/policyengine_uk_data/tests/test_changelog_encoding.py
new file mode 100644
index 000000000..fa8dfd2dd
--- /dev/null
+++ b/policyengine_uk_data/tests/test_changelog_encoding.py
@@ -0,0 +1,93 @@
+"""Test that changelog files are valid UTF-8 and can be parsed by yaml-changelog."""
+
+import pytest
+from pathlib import Path
+import yaml
+
+
+def get_repo_root() -> Path:
+    """Get the repository root directory."""
+    current = Path(__file__).resolve()
+    while current != current.parent:
+        if (current / "pyproject.toml").exists():
+            return current
+        current = current.parent
+    raise RuntimeError("Could not find repository root")
+
+
+class TestChangelogEncoding:
+    """Tests for changelog file encoding validation."""
+
+    def test_changelog_entry_is_valid_utf8(self):
+        """Test that changelog_entry.yaml is valid UTF-8.
+
+        This prevents CI failures from the yaml-changelog tool which
+        cannot parse files with non-UTF-8 characters (e.g., Latin-1
+        encoded £ symbols).
+        """
+        repo_root = get_repo_root()
+        changelog_entry_path = repo_root / "changelog_entry.yaml"
+
+        if not changelog_entry_path.exists():
+            pytest.skip("No changelog_entry.yaml file present")
+
+        # Read as bytes and try to decode as UTF-8
+        content_bytes = changelog_entry_path.read_bytes()
+
+        try:
+            content_bytes.decode("utf-8")
+        except UnicodeDecodeError as e:
+            # Find the problematic byte for better error message
+            bad_byte = content_bytes[e.start : e.start + 1]
+            pytest.fail(
+                f"changelog_entry.yaml contains non-UTF-8 bytes at position "
+                f"{e.start}: {bad_byte.hex()} (0x{bad_byte.hex()}). "
+                f"This is likely a Latin-1 encoded character. "
+                f"Please re-save the file with UTF-8 encoding."
+            )
+
+    def test_changelog_entry_is_valid_yaml(self):
+        """Test that changelog_entry.yaml is valid YAML."""
+        repo_root = get_repo_root()
+        changelog_entry_path = repo_root / "changelog_entry.yaml"
+
+        if not changelog_entry_path.exists():
+            pytest.skip("No changelog_entry.yaml file present")
+
+        content = changelog_entry_path.read_text(encoding="utf-8")
+
+        try:
+            data = yaml.safe_load(content)
+        except yaml.YAMLError as e:
+            pytest.fail(f"changelog_entry.yaml is not valid YAML: {e}")
+
+        # Verify structure
+        assert isinstance(data, list), "changelog_entry.yaml must be a list"
+        for entry in data:
+            assert "bump" in entry, "Each entry must have a 'bump' field"
+            assert entry["bump"] in (
+                "patch",
+                "minor",
+                "major",
+            ), f"Invalid bump type: {entry['bump']}"
+            assert "changes" in entry, "Each entry must have a 'changes' field"
+
+    def test_changelog_yaml_is_valid_utf8(self):
+        """Test that changelog.yaml is valid UTF-8."""
+        repo_root = get_repo_root()
+        changelog_path = repo_root / "changelog.yaml"
+
+        if not changelog_path.exists():
+            pytest.skip("No changelog.yaml file present")
+
+        content_bytes = changelog_path.read_bytes()
+
+        try:
+            content_bytes.decode("utf-8")
+        except UnicodeDecodeError as e:
+            bad_byte = content_bytes[e.start : e.start + 1]
+            pytest.fail(
+                f"changelog.yaml contains non-UTF-8 bytes at position "
+                f"{e.start}: {bad_byte.hex()} (0x{bad_byte.hex()}). "
+                f"Please re-save the file with UTF-8 encoding."
+            )