Autumn Budget 2026: Key Tax Changes and What They Mean for You

A £3,000 Trading Allowance, tax free ISA amount will remain at £20,000 and higher taxes on rental income. The Autumn Budget 2026 brings welcome news for some taxpayers, but higher taxes and changes to business reliefs mean others could face bigger bills.

On 28 October, Chancellor John Healey delivered his first Budget, announcing measures to ease living costs and support business growth.

While headline rates of Income Tax, National Insurance and VAT remain unchanged, several tax changes are coming from April 2027.

Here’s what the announcements mean for your finances.

What Are the Key Tax Changes in the Autumn Budget 2026?

Income Tax on Property and Savings to Increase

Landlords and savers could be handing over an even bigger share of their income to HMRC. From 6 April 2027, Income Tax rates on property and savings income will rise by a further two percent, bringing them to:

• Basic rate: 24%
• Higher rate: 44%
• Additional rate: 49%

These increases come on top of those announced in the 2025 Budget.

For landlords, this means more rental profits could go towards tax. Someone with £10,000 of taxable rental income could pay an additional £200 compared with the rates previously scheduled for April 2027, assuming all that income falls within the same tax band.

Cash ISA Allowance Remains at £20,000

Savers can breathe a sigh of relief. Plans to slash the annual cash ISA allowance by £8,000 have been scrapped, meaning the £20,000 limit is here to stay.

What Does the Budget Mean for Businesses and the Self-Employed?

Trading Allowance Triples to £3,000

Running a side hustle? You could soon earn three times as much before paying Income Tax on qualifying trading income. From 6 April 2027, the Trading Allowance will increase from £1,000 to £3,000.

This means individuals can earn up to £3,000 of qualifying trading income annually without paying Income Tax on it.

Whether you’re freelancing or running a side business, the increase could make a difference. However, claiming actual business expenses instead may be more beneficial in some circumstances.

Business Asset Disposal Relief Limit Halved

Thinking of selling your business? You could be facing a significantly bigger Capital Gains Tax bill. From 6 April 2027, the lifetime limit for Business Asset Disposal Relief (BADR) will fall from £1 million to £500,000.

BADR allows qualifying business owners to pay a reduced 18% Capital Gains Tax rate on eligible gains.

The lower limit means some owners could face higher tax bills when selling their businesses.

New Founders’ Relief Announced

Selling a successful innovative business could become considerably more tax-efficient for some entrepreneurs. A new Founders’ Relief will offer qualifying founders a 10% Capital Gains Tax rate on up to £10 million of lifetime gains from April 2027.

Small Business Rates Relief Expanded

Could your business be one of 70,000 to benefit from paying no business rates? From April 2027, the threshold for 100% Small Business Rate Relief will increase from £12,000 to £18,000 for qualifying retail, hospitality and leisure properties in England.

National Living Wage to Rise

A pay rise for millions of workers, but another cost increase for employers. From April 2027, the National Living Wage will rise by 3.9%, taking hourly pay for workers aged 21 and over from £12.71 to £13.21.

What Other Tax Changes Were Announced?

Business Mileage Rates Increase

Drive more than 10,000 business miles a year? There’s some good news. From April 2027, the tax-free mileage rate above this threshold will increase from 25p to 35p per mile.

Changes to Self Assessment Payments on Account

Could smaller, more frequent tax payments make Self Assessment less stressful? From April 2029, the government plans to change how some taxpayers make Payments on Account, potentially making tax bills easier to manage.

HMRC to Strengthen Tax Compliance

HMRC is stepping up its efforts to recover unpaid tax. With plans to recruit 670 additional compliance officers by 2029/30 and strengthen debt collection powers, keeping accurate records and meeting deadlines will become even more important.

What Does the Autumn Budget Mean for Households?

The Chancellor also announced several measures to ease household costs:

• Energy support: A £100 payment for eligible households in England in council tax bands A–D from January 2027.
• Fuel duty: The temporary 5p cut and freeze will continue until July 2027.
• Gas standing charges: Plans to remove these charges from 2027 onwards.
• First-time buyers: A new £4.7 billion Your First Home equity-loan scheme.
• Parental support: Plans to introduce parental pay for eligible self-employed fathers and partners from April 2029.

What Should You Do Following the Autumn Budget 2026?

While some changes won’t take effect for a few years, it’s worth considering their impact now.

Landlords may face higher tax bills, business owners planning a sale should review their Capital Gains Tax position, and employers will need to prepare for increased wage costs.

For sole traders and those earning additional income, the increased Trading Allowance could also offer opportunities.

The key is understanding which changes affect you and when they take effect.

Get Expert Tax Advice Following the Autumn Budget 2026

The Budget brings opportunities for some taxpayers and additional costs for others. With several changes coming in April 2027, now is a good time to plan ahead. A tax change that looks small on paper could make a big difference to your finances.

At DNS Accountants, we can help you understand how the announcements affect your finances or business and prepare for what’s coming.

Whether you need support with Self Assessment, business taxes, Capital Gains Tax or property income, we’re here to help.

Book a consultation or contact us today on 033 0088 3616 or email [email protected].

About the author

Sumit Agarwal
Sumit Agarwal (ACMA ACA India), the Managing partner of dns accountants is a highly respected accountant with expertise in helping owner-managed businesses.