Autumn Budget 2026: UK Tax Changes, Rates and Key Dates

Chancellor John Healey delivered the Autumn Budget on Wednesday 28 October 2026. He left the headline rates of income tax, National Insurance and VAT alone. The tax rises fall on property and savings income (up a further two percentage points from April 2027), on Business Asset Disposal Relief (the lifetime limit halves to £500,000) and on banks. Founders get a new 10% capital gains tax relief, and the trading allowance triples to £3,000.

Scope: UK-wide unless stated. Separate property income rates apply in England, Wales and Northern Ireland. Some measures were announced at earlier Budgets and only confirmed on 28 October, and we mark those as previously announced. Tax year 2026/27. Last reviewed 30 October 2026.

Table of Contents

TL;DR

Income tax, National Insurance and VAT rates are unchanged, and personal tax thresholds stay frozen until 2031
Property and savings income will be taxed at 24%, 44% and 49% from April 2027
Founders’ Relief starts on 6 April 2027, while the Business Asset Disposal Relief limit falls to £500,000
The £20,000 ISA allowance stays, and the planned cash ISA restriction is dropped
The National Living Wage rises 3.9% to £13.21 an hour from 1 April 2027

Autumn Budget 2026 key tax changes at a glance

Measure	What changed	Who it affects
Property and savings income tax	Rates rise a further 2 points to 24% basic, 44% higher and 49% additional from April 2027	Landlords and savers
Business Asset Disposal Relief (BADR)	Lifetime limit cut from £1 million to £500,000	Owners selling a business
Founders’ Relief	New 10% CGT rate on lifetime gains up to £10 million from 6 April 2027	Qualifying founders
Dividend tax	No further rise	Company directors and shareholders
ISAs	£20,000 allowance unchanged, planned cash ISA restriction dropped	Savers
Trading allowance	Rises from £1,000 to £3,000	People with side income
Capital allowances	Main rate writing-down allowance falls from 14% to 12%, first-year allowance rises from 40% to 50%	Businesses that invest
Small business rates relief	Threshold for retail, hospitality and leisure rises from £12,000 to £18,000	Shops, pubs and restaurants
National Living Wage	£12.71 to £13.21 an hour from 1 April 2027	Employers and workers
Bank surcharge	Rises from 3% to 6% for 15 months from 1 January 2027	Banks

What did the Autumn Budget 2026 change for individuals?

Higher tax on property and savings income

Tax on property and savings income rises by a further two percentage points from April 2027. The new rates are 24% for basic-rate taxpayers, 44% for higher-rate and 49% for additional-rate. They sit four points above today’s 20%, 40% and 45%, which you can see in our guide to UK income tax bands. Separate property income rates apply in England, Wales and Northern Ireland.

Here is what that means for a landlord. A higher-rate taxpayer with £10,000 of rental profit would pay £4,400 at the new rate, against £4,000 now, before any allowances. Individual landlords and property partnerships carry more of the burden than companies that hold property.

Dividend tax stays where it is. The basic and higher dividend rates already rose to 10.75% and 35.75% in April 2026, and the Chancellor confirmed no further increase.

Capital gains tax and Business Asset Disposal Relief

The main capital gains tax rates did not change, despite weeks of speculation. The change that matters most for business owners is to BADR. The lifetime limit drops from £1 million to £500,000. BADR gains are taxed at 18%, while the main higher rate is 24%, so a higher-rate taxpayer who uses the full £500,000 saves at most £30,000. Landlords selling a property should read our guide to capital gains tax on UK property.

A new Founders’ Relief starts on 6 April 2027. Qualifying founders pay 10% on lifetime gains up to £10 million. The conditions are stricter than the old Entrepreneurs’ Relief, and many owners will find them hard to meet. If you plan to sell a company in the next few years, check both reliefs against your own shareholding before you decide on timing.

ISAs and saving

The annual ISA allowance stays at £20,000. The previous Budget’s plan to restrict £8,000 of it to investments from April 2027 has been scrapped. A new ISA for first-time buyers will replace the Lifetime ISA from April 2029. It keeps the £4,000 a year limit and 25% bonus. From 29 October 2026 the charge on a Lifetime ISA used for a first home above £450,000 falls from 25% to 20% of the balance. The government also plans a separate “starter ISA” to encourage first-time investors, but has not announced details.

Because savings income will be taxed at higher rates from April 2027, the tax-free wrapper is worth more than it was. Our UK ISAs explained guide covers which type suits which goal.

Pensions and inheritance tax

The pension tax-free lump sum is unchanged. Most people can still take 25% of their pension tax free, up to the Lump Sum Allowance of £268,275.

A new Pension Tax Allowance runs from 6 April 2027 to 5 April 2030. It stops pensioners whose only income is the basic or new State Pension from paying small tax bills when the pension rises above the personal allowance. The Chancellor also proposed replacing the triple lock with a double lock from April 2030, subject to the government winning the next general election.

Inheritance tax saw no new changes. The seven-year rule for lifetime gifts, gift exemptions, taper relief and the residence nil rate band all stay as they are. The threshold stays frozen until 2030/31. Two earlier measures still apply: the £2.5 million cap on 100% agricultural and business property relief took effect in April 2026, and unused pension funds come into inheritance tax from April 2027.

Work, side income and carers

The trading allowance rises from £1,000 to £3,000, so more people can earn side income without reporting it. The National Living Wage rises 3.9% to £13.21 an hour from 1 April 2027, and the minimum wage for 18 to 20 year olds rises to £11.27. You can check the current figures in our UK minimum wage rates by age guide. Carer’s Allowance loses its earnings cliff edge and gets a taper instead. Self-employed fathers and partners become eligible for paternity leave.

The Budget also confirmed that self assessment payments will be brought forward from 2029, so it pays to avoid common self assessment mistakes. Making Tax Digital for Income Tax continues on its existing timetable: sole traders and landlords with income over £50,000 joined in April 2026, the limit falls to £30,000 in April 2027, and to £20,000 in April 2028.

What did the Autumn Budget 2026 change for businesses?

Corporation tax and capital allowances

Corporation tax stays capped at 25% for the duration of this Parliament (previously announced), and full expensing remains for qualifying plant and machinery. The writing-down allowance on main-rate assets falls from 14% to 12% from April 2027. The first-year allowance rises from 40% to 50% for spending from 1 January 2027, which mainly helps unincorporated businesses and some leasing businesses.

The R&D claim notification form is removed from 1 April 2027, and the additional information form will be simplified from autumn 2027. Reforms to the company distributions rules start on 6 April 2028 and are likely to affect capital reductions, company purchases of own shares and demergers.

Employee share schemes get a boost. The individual option limit for the company share option plan, now branded EMI2, doubles from £60,000 to £120,000, and the exercise period extends to 15 years. Most of these changes start on 6 April 2027.

Business rates

Small business rates relief for retail, hospitality and leisure properties rises from a £12,000 threshold to £18,000, with the upper limit for tapered relief at £21,000. Around 70,000 more businesses will drop out of rates entirely. Other businesses in those sectors get a two-year freeze. Relief for pubs and live music venues rises to 35% from April 2027, up from the 20% announced earlier. Vape shops and adult gaming centres lose their business rates reliefs from 1 April 2027.

VAT, duties and compliance

The VAT registration threshold is unchanged. Online marketplaces will become responsible for collecting and paying VAT on online sales by UK sellers. VAT on domestic electricity stays removed until July 2027, new customs duty exemptions cover more than 100 imported products, and the fuel duty freeze and 5p cut are extended to July 2027.

Machine Games Duty rises from 20% to 25% from 1 April 2027. A new securities transfer tax, due in late 2027, will replace stamp duty on shares. HMRC receives £70 million of extra funding, and from 1 April 2028 it can issue a Customer Correction Notice where it suspects an inaccuracy. Our guide to HMRC penalties and interest shows what errors can cost.

What did not change in the Autumn Budget 2026?

Income tax, National Insurance and VAT rates are unchanged, and so are the main capital gains tax rates. There was no reform of council tax or stamp duty land tax. Personal tax thresholds stay frozen until 2031, which means rising pay pulls more people into higher bands. Tax Policy Associates estimates the Budget’s tax measures add only about £0.7 billion in 2027/28, with most of the revenue arriving in later years.

The high-value council tax surcharge, announced earlier, still starts in April 2028 for homes worth £2 million or more. It runs from £2,500 a year for the lowest band up to £7,500 for properties over £5 million.

Key dates from the Autumn Budget 2026

Date	What happens
1 January 2027	Bank surcharge rises to 6% for 15 months. First-year allowance rises to 50%
1 April 2027	National Living Wage rises to £13.21. R&D claim notification form removed. Machine Games Duty rises to 25%. Pub and live music venue rates relief rises to 35%
April 2027	Tax on property and savings income rises to 24%, 44% and 49%. Writing-down allowance falls to 12%. Making Tax Digital threshold drops to £30,000. Pension funds enter inheritance tax
6 April 2027	Founders’ Relief starts. Pension Tax Allowance begins. Most EMI2 changes take effect
Late 2027	Securities transfer tax replaces stamp duty on shares
1 April 2028	HMRC can issue Customer Correction Notices
April 2028	High-value council tax surcharge starts. Making Tax Digital threshold drops to £20,000
6 April 2028	Company distributions reforms begin
2029	Self assessment payments brought forward. Salary sacrifice pension contributions above £2,000 lose National Insurance exemption from April 2029

Autumn Budget 2026 FAQs

Did the Autumn Budget 2026 raise income tax?

No. The Chancellor left income tax, National Insurance and VAT rates unchanged. Thresholds stay frozen until 2031, so more income is pulled into higher bands as pay rises.

What are the new tax rates on property and savings income?

From April 2027 the rates are 24% for basic-rate taxpayers, 44% for higher-rate and 49% for additional-rate. That is two points above the rates already planned and four points above today’s.

What is Founders’ Relief?

Founders’ Relief is a new capital gains tax relief that starts on 6 April 2027. It taxes qualifying founders’ lifetime gains up to £10 million at 10%. The conditions are stricter than the old Entrepreneurs’ Relief.

Has Business Asset Disposal Relief been abolished?

No. The lifetime limit falls from £1 million to £500,000. Gains within the limit are taxed at 18%.

Is the ISA allowance changing?

No. The annual allowance stays at £20,000, and the planned restriction on cash ISAs has been dropped. The Lifetime ISA will be replaced by a new ISA for first-time buyers from April 2029.

What will the National Living Wage be from April 2027?

It will be £13.21 an hour from 1 April 2027, a 3.9% rise from £12.71.

Did inheritance tax change?

The Budget made no new inheritance tax changes. The threshold stays frozen until 2030/31, the £2.5 million cap on agricultural and business property relief applies from April 2026, and unused pension funds enter inheritance tax from April 2027.

What to do next

Three groups should look at their position soon: landlords and savers facing the April 2027 rate rise, owners planning a sale who need to compare BADR with Founders’ Relief, and employers budgeting for the April 2027 wage increase. To see what your own income looks like after tax, try our UK income tax calculator guide.

This article is general information and not personal tax advice. Rules and rates can change when the Finance Bill is published, so confirm the detail for your own situation before acting.