The technology difference
Non-condensing boilers (standard efficiency) allow flue gases to exit at 250–300°C, wasting that heat. Condensing boilers have a secondary heat exchanger that captures this heat before it leaves the flue — cooling gases to 50–55°C and condensing the water vapour.
Efficiency comparison
Non-condensing (pre-2005): 65–75% efficiency. Condensing: 90–96% efficiency. The condensing boiler converts 20–25 percentage points more of your gas into heat.
Annual savings
On a £1,200/year gas bill, upgrading from 70% to 94% efficiency saves approximately £300/year. The new boiler typically pays back in energy savings alone within 4–5 years.
Legal status
Since 2005, non-condensing boilers cannot be newly installed in domestic properties in England and Wales. If you have one, it's likely 18+ years old and significantly past its optimal replacement date.
The condensate complication
Condensing boilers produce condensate (acidic waste water) that must be drained. This requires a route to an internal or external drain — occasionally a constraint in some properties. This is always manageable with good installation design.
Verdict
Condensing boilers are unambiguously better — more efficient, legally required for new installs, and will save hundreds per year vs an old non-condensing boiler. If you have a pre-2005 non-condensing boiler, replacing it should be a priority.