Autumn Budget 2026 in detail: every change for small businesses, employers, landlords and households

Our key points summary covered the headlines from the Autumn Budget on 28 October 2026. This is the longer version. We’ve been through the full Budget document line by line and pulled out every change that could affect a small business, an employer, a landlord or a household, however small.

Use the headings to jump to the parts that apply to you. Nothing here needs you to act today: most changes start in April 2027 or later, and some are still out for consultation. For each one we’ve said what’s changing and when.

Contents

• At a glance: the dates that matter
• Everyone: income tax, savings, ISAs and pensions
• Sole traders and the self-employed
• Limited companies and directors
• Employers and payroll
• VAT
• Business rates (England)
• Cars, vans, fuel and mileage
• Landlords and property
• Paying HMRC and dealing with HMRC
• Households: energy, food and family
• Already announced last year and still coming
• What didn’t change

At a glance: the dates that matter

When	What changes
28 October 2026	Some anti-avoidance and pension death benefit changes take effect (most people won’t notice)
1 November 2026	Public and workplace EV charging confirmed as 20% VAT
January 2027	£100 Household Energy Payment (England, council tax bands A–D)
1 January 2027	Main-rate first-year allowance on plant and machinery rises to 50%
1 April 2027	National Living Wage £13.21; business rates changes for retail, hospitality and leisure (England); reverse charge on overseas services restricted to VAT-registered businesses; R&D claim notification form scrapped; vehicle excise duty uprated
6 April 2027	Savings and property income tax rates 24% / 44% / 49%; Trading Allowance £3,000; writing down allowance 12% (1 April for companies); 35p higher mileage rate; Business Asset Disposal Relief limit £500,000; Founders’ Relief; Pension Tax Allowance; share scheme changes
April 2027	Making Tax Digital for Income Tax for those due to join, with no penalty points for the first four late quarterly updates
1 July 2027	Fuel duty cut, red diesel cut and 0% VAT on domestic electricity due to end
October 2027	Online marketplaces start collecting VAT on sales by UK businesses
April 2028	Company distributions rules modernised; £2,500 employment expenses threshold removed; new subsistence rates for business travel; new rules on correcting errors in returns
April 2029	VAT e-invoicing; direct debits required for VAT and PAYE; new payments on account system; self-employed parental pay; First Time Buyer ISA

Everyone: income tax, savings, ISAs and pensions

• No rise in the headline rates of Income Tax, National Insurance or VAT.
• Tax on savings income goes up. From 6 April 2027 the savings rates rise by a further 2 percentage points to 24% (basic), 44% (higher) and 49% (additional), across the whole UK. That’s on top of the 2-point rise announced last year. Tax on wages and pensions is unchanged.
• Most savers still won’t pay tax on interest. The government says a basic rate taxpayer would need more than £25,000 in savings outside ISAs before paying any tax on the interest. People who qualify for the Starting Rate for Savings could have up to £150,000.
• Cash ISA limit stays at £20,000. The cut announced last year won’t go ahead.
• New ISA incentive. The government will work with providers on a new incentive for people investing in a stocks and shares ISA for the first time. No details yet.
• Pension Tax Allowance. From 6 April 2027 to 5 April 2030, pensioners whose total income is no more than the full new State Pension won’t have to pay small amounts of tax. The allowance tapers away for incomes just above that level.
• State Pension. The Triple Lock stays for this Parliament (rises up to April 2029). From April 2030 it will be adjusted so the State Pension rises by the highest of 2.5%, inflation, or the amount needed to keep its value relative to earnings as reached in April 2029.
• Pension death benefits. From 28 October 2026, beneficiaries will no longer be taxed just because tax-free pension death benefits are paid more than two years after the member’s death.
• Terminal illness and pensions. The definition will change to make it easier for terminally ill people to access their pension savings.
• Married Couple’s Allowance, Blind Person’s Allowance and Qualifying Care Relief (for foster carers and shared lives carers) rise with inflation from 6 April 2027.
• Child Benefit. HMRC will automatically offset Child Benefit overpayments against the High Income Child Benefit Charge.
• Inheritance Tax. A technical change from 28 October 2026 limits when debts linked to trust property can reduce the value of an estate. This mainly affects trust arrangements.

Sole traders and the self-employed

• Trading Allowance trebles to £3,000. From 6 April 2027, you can earn up to £3,000 a year from trading and miscellaneous income (for example small side hustles) tax-free, up from £1,000. Good news for anyone with a small sideline.
• Making Tax Digital for Income Tax. If you’re due to join in April 2027, you won’t get penalty points for late submission of your first four quarterly updates in 2027-28. The government is also deferring the roll-out for “several taxpayer groups until further notice”. HMRC hasn’t yet said which groups, and we’ll update you when it does.
• Mileage. 55p a mile for the first 10,000 business miles is now permanent, and the rate above 10,000 miles rises from 25p to 35p from 6 April 2027. This applies to the self-employed using simplified expenses as well as employees.
• Capital allowances. The main-rate first-year allowance rises to 50% for spending from 1 January 2027, and the main writing down allowance falls from 14% to 12% from 6 April 2027 (for Income Tax). If you’re planning to buy equipment, timing could matter. Talk to us first.
• Payments on account. From April 2029, people who already make payments on account will pay smaller, more regular amounts through the year instead of two big payments.
• Self-employed parental pay. From April 2029, eligible self-employed fathers, partners and adopters in Great Britain will be able to get parental pay for the first time.
• Young Entrepreneurs Allowance. A pilot in England will help some young people with living costs in the first year of their business.

Limited companies and directors

• Corporation Tax. The main rate stays capped at 25%, and full expensing is kept.
• Capital allowances. Main-rate first-year allowance up from 40% to 50% for spending from 1 January 2027; main writing down allowance down from 14% to 12% from 1 April 2027.
• Selling your business. The Business Asset Disposal Relief lifetime limit (the 18% Capital Gains Tax rate) halves from £1 million to £500,000 for disposals from 6 April 2027. If a sale is on the horizon, the timing is worth discussing now.
• Founders’ Relief. A new 10% Capital Gains Tax rate on up to £10 million of lifetime gains, from 6 April 2027, for qualifying founders of high-growth, innovative companies. The detailed rules are out for consultation.
• Taking money out of your company. No new dividend tax rates were announced. The rules on how company distributions are taxed will be modernised from April 2028, so that similar transactions are taxed the same way whatever form they take. The government says genuine changes of ownership, including families passing a business down, keep capital treatment. Draft legislation is due in 2027.
• Loans to directors and shareholders. The proposed extra reporting of company payments to participators won’t go ahead for now.
• Share schemes. From 6 April 2027:
  • the Company Share Option Plan limit doubles to £120,000 per employee, the plan is renamed “EMI2”, and its exercise period extends from 10 to 15 years;
  • EMI options can be exercised up to 180 days (was 90) after a disqualifying event;
  • companies moving to an Employee Ownership Trust keep access to EMI;
  • EMI option grants no longer need a separate notification to HMRC. They go on the year-end return instead.
• R&D tax relief. The Claim Notification Form is scrapped from 1 April 2027 and the Additional Information Form will be simplified from autumn 2027.
• Investment schemes. Technical changes will make EIS, SEIS and Venture Capital Trusts easier to use.
• Corporation Tax simplification. There’s a new consultation on simplifying parts of Corporation Tax, and a call for evidence on modernising how it’s reported and paid.
• Funding. The British Business Bank gets an extra £5 billion of capacity, and UK Export Finance is widening access for smaller exporters, with a new SME export finance scheme in 2027.
• Non-compete clauses. The government plans to legislate so non-compete clauses in employment contracts don’t stop people moving jobs. Details are due in early 2027.

Employers and payroll

• Minimum wage from 1 April 2027:
  • National Living Wage £13.21 an hour;
  • 18–20-year-olds £11.27;
  • 16–17-year-olds and eligible apprentices £8.31;
  • accommodation offset £11.53 a day.

  All rates are up 3.9%.

• No change to employer National Insurance rates was announced.
• Mileage allowances. Staff using their own car or van can be paid 55p a mile tax-free for the first 10,000 business miles (now permanent), and 35p a mile above that from 6 April 2027.
• Business travel subsistence. From April 2028, the Benchmark Scale Rates for paying staff subsistence on UK business trips will be updated to reflect current costs, and Overseas Scale Rates will be simplified into tiers.
• Company cars and vans. Van Benefit Charge and fuel benefit charges rise with inflation from 6 April 2027. Company car tax percentages for 2030-31 are set 1 point higher than 2029-30 across all bands (electric cars 10%, up from 9%), capped at 40%.
• Employment expenses. From 6 April 2028, the £2,500 Self Assessment threshold for claiming work expenses goes, so more employees can claim through PAYE.
• Image rights. Image rights payments linked to an employment will be taxed as employment income from 6 April 2028 (delayed by a year).
• Termination payments. The legislation on how termination payments are taxed is being clarified, from 28 October 2026.
• Apprenticeships. £100 million to expand local apprenticeship support so every current mayor can help young people and employers, particularly smaller ones, create apprenticeships.

VAT

• Online marketplaces. From October 2027, online marketplaces will collect VAT on sales by UK VAT-registered businesses, and on sales by other UK businesses selling more than £90,000 a year through that platform. It won’t apply to personal sales, second-hand goods or business-to-business sales. If you sell through Amazon, eBay, Etsy or similar, this will change how VAT works for you.
• Services bought from overseas. From April 2027, the “reverse charge” on services bought from overseas suppliers will only apply to VAT-registered businesses. Overseas suppliers selling to non-VAT-registered UK businesses will have to charge UK VAT themselves.
• E-invoicing. VAT invoices must be issued in a specified electronic format from 1 April 2029. Full technical details are due by April 2028. Worth bearing in mind if you’re choosing new accounting software.
• Direct debit for VAT. From 1 April 2029, VAT-registered businesses will need a direct debit set up for their VAT return liabilities. You can still pay by other methods before a cut-off date. The direct debit collects anything left unpaid.
• EV charging. From 1 November 2026, electricity from public and workplace EV chargers is confirmed as standard-rated (20%).
• Energy saving materials. Heat batteries join the 5% reduced rate for energy saving materials from 1 April 2027.
• Private hire. The largest private hire operators (lead option: £50 million+ fare turnover) will charge 20% VAT on full fares from 2 January 2028. Smaller operators aren’t affected.
• Till systems. Mandatory software standards are coming for electronic and mobile point-of-sale systems to tackle sales suppression. A consultation is due in summer 2027.
• Travel businesses. A call for evidence on the Tour Operators’ Margin Scheme.

Business rates (England)

• Small Business Rate Relief for retail, hospitality and leisure. From 1 April 2027, 100% relief applies up to a rateable value of £18,000 (was £12,000), with tapered relief up to £21,000 (was £15,000). The government expects around 70,000 more high street businesses to pay nothing.
• Real-terms freeze. Bill increases for qualifying retail, hospitality and leisure properties are capped at inflation in 2027-28 and 2028-29.
• Pubs, social clubs and live music venues get 35% relief from 1 April 2027 (up from 15%). The very largest venues are excluded.
• Supporting Small Business scheme extended for a year from 1 April 2027.
• Appeal fees scrapped. The Valuation Tribunal’s £150 and £300 appeal fees are abolished, and fees already paid on 2026-list appeals will be refunded.
• Vape shops and adult gaming centres lose access to the retail, hospitality and leisure rates (and vape shops lose Small Business Rate Relief) from April 2027.

Cars, vans, fuel and mileage

• Fuel duty. The 5p-a-litre cut is extended to 1 July 2027, and the planned inflation increase is deferred to the same date.
• Red diesel. The 3.7p cut is also extended to 1 July 2027.
• Mileage rates. 55p for the first 10,000 business miles (permanent) and 35p above that from 6 April 2027.
• Vehicle excise duty for cars, vans and motorbikes rises with RPI from 1 April 2027. The £1 VED rate for most HGVs runs until 30 June 2027.
• Electric cars. The mileage-based Electric Vehicle Excise Duty (eVED) still starts in April 2028, with an estimation tool, an opt-in connected-car option and easier refunds promised.
• Public EV charging. £100 million over two years to cut costs at lower-powered public chargers from spring 2027.

Landlords and property

• Tax on rental income goes up. From 6 April 2027 the property income rates rise by a further 2 points to 24% (basic), 44% (higher) and 49% (additional) in England, Wales and Northern Ireland. That’s on top of the rise announced last year.
• Third-party data. A consultation on HMRC collecting more property income data from third parties to check returns.
• Making Tax Digital. Landlords due to join in April 2027 get the same penalty points easement as the self-employed.
• Stamp Duty on assured tenancies. Stamp Duty Land Tax on rent paid under assured tenancies in England is removed, backdated to 1 May 2026.
• High Value Council Tax Surcharge (England). Confirmed, with a deferral scheme, discounts and exemptions, and a 100% premium on properties empty for 12 months or more.
• ATED charges rise 3.5% for 2027-28.
• International data sharing. The UK will join a new international agreement to share information on property ownership from 2029-30.

Paying HMRC and dealing with HMRC

• Payments on account become smaller and more frequent from April 2029, for people who already make them.
• Direct debits for VAT and PAYE. Required from 1 April 2029 (VAT) and 6 April 2029 (PAYE).
• Collecting unpaid tax. From July 2029 HMRC will be able to collect smaller tax debts in instalments directly from the bank accounts of people and companies who can afford to pay but repeatedly don’t. There will be a Code of Practice and safeguards.
• Correcting errors. New requirements to correct tax returns and documents when you find a mistake, from 1 April 2028.
• Information powers. HMRC’s powers to request information are being updated, including a modern definition of “computer records”.
• More compliance staff. 670 extra HMRC compliance officers by 2029-30.
• Choosing an adviser. A roadmap in spring 2027 will look at helping taxpayers choose advisers and raising standards for tax software.

Households: energy, food and family

• £100 Household Energy Payment. From January 2027 for households in England in council tax bands A–D, paid through the council tax system. Councils also get £100 million for extra targeted help.
• 0% VAT on domestic electricity extended to 1 July 2027. That’s expected to take around £50 off the April 2027 price cap.
• Gas standing charges. Ofgem has been asked to abolish them on domestic bills, aiming for the end of 2027.
• Food and heating oil. Tariffs suspended on over 100 food products and kerosene heating oil until December 2028, and on fertiliser until December 2027.
• First-time buyers:
  • a new First Time Buyer ISA from April 2029 (25% government bonus, homes up to £450,000, bonus capped at £20,000), replacing the Lifetime ISA for new savers;
  • from 29 October 2026, the Lifetime ISA withdrawal charge for homes above the price cap falls to 20%;
  • a new “Your First Home” equity loan scheme offers loans of up to 20%, with a five-year interest-free period.
• Parental pay for self-employed fathers, partners and adopters from April 2029.
• Carer’s Allowance. A taper on earnings above the limit will replace the “cliff edge” in 2030-31.

Already announced last year and still coming

A few changes from the November 2025 Budget weren’t repeated on the day but are still going ahead:

• Income Tax thresholds stay frozen until April 2031.
• Dividend tax rates rose by 2 points from April 2026 (10.75% basic, 35.75% higher).
• From April 2029, only the first £2,000 a year of pension contributions made by salary sacrifice will be free of National Insurance.
• Making Tax Digital for Income Tax comes in for those with self-employment and property income over £30,000 from April 2027, and over £20,000 from April 2028 (subject to the deferrals announced this week).

What didn’t change

• Headline rates of Income Tax, National Insurance and VAT.
• The 25% cap on the main rate of Corporation Tax, and full expensing.
• Dividend tax rates (no further change announced).
• The £20,000 cash ISA limit.

What to do now

• Thinking of selling your business? Talk to us before 6 April 2027 about Business Asset Disposal Relief.
• Buying equipment? The 50% first-year allowance from 1 January 2027 and the lower writing down allowance from April 2027 could affect when to buy.
• Employing people? Budget for the new wage rates from 1 April 2027.
• Landlord or saver? Look at how the higher rates from April 2027 affect you. ISAs, pension contributions and how savings are held are all worth reviewing.
• Got a small side income? The £3,000 Trading Allowance from April 2027 may mean you don’t need to pay tax on it.
• Selling online? Check how the marketplace VAT rules from October 2027 will affect you.
• Due to join Making Tax Digital? Carry on getting ready. We’ll confirm which groups are deferred once HMRC publishes the detail.

If you’d like to know what the Budget means for you or your business, book a free call with our team: www.kara-accountants.net/contact/

Sources: HM Treasury – Budget 2026 (28 October 2026), mainly Chapter 7 “Policy decisions”; measures from last year’s Budget per HM Treasury’s Budget 2025 (26 November 2025). This is a summary of the announcements, not personal advice. Many measures still need to pass into law through the Finance Bill, and HMRC will publish more detail over the coming weeks. We’ll update this page as it does.