We’ve highlighted some important announcements for the Autumn budget 2026, delivered today (28th October 2026) by the Chancellor, John Healey, announcing a number of changes to taxation and tax administration.
Although the Government has maintained its commitment not to increase the headline rates of Income Tax, National Insurance or VAT, there are several announcements which will affect individuals, landlords and smaller businesses.
Please find the main announcements from the Autumn budget 2026 below, focusing on those most relevant to you.
Income Tax on property and savings income
One element of the Autumn budget 2026 is that the Government has announced a further increase in the rates of Income Tax applicable to property and savings income from 6th April 2027.
For property income, the new basic, higher and additional rates will be 24%, 44% and 49% respectively. These rates will apply in England, Wales and Northern Ireland.
The same rates will apply to savings income across the UK.
These increases are in addition to those announced in the 2025 Budget, meaning that the rates will be four percentage points higher than those applying before the earlier changes.
The changes will be particularly relevant to landlords and individuals who currently receive taxable interest on savings. The headline Income Tax rates applicable to employment and self-employment income remain unchanged.
Trading Allowance increased from £1,000 to £3,000
From 6th April 2027, the Trading Allowance will increase from £1,000 to £3,000.
This will allow individuals to receive up to £3,000 of qualifying trading or miscellaneous income without paying Income Tax on that income.
The increase will be particularly relevant to individuals undertaking occasional work or operating very small businesses.
Please note that this increase in the allowance does not necessarily remove other tax reporting or registration obligations.
Making Tax Digital for Income Tax
As part of this Autumn budget 2026, the Government has confirmed a further penalty easement for taxpayers joining Making Tax Digital for Income Tax (MTD) in April 2027.
Taxpayers entering MTD from 6th April 2027 will not receive penalty points for late submission of their first four quarterly updates during the 2027/28 tax year. As well as this, the Government has also announced in this budget that the introduction of MTD for certain groups of taxpayers will be deferred until further notice.
The wider rollout remains scheduled to extend to those with qualifying income above £30,000 from April 2027 and £20,000 from April 2028, subject to the relevant exemptions and deferrals.
For guidance on Making Tax Digital, please visit our dedicated MTD page for more support.
Changes to Self Assessment payments in the Autumn budget 2026
A potentially important change for the self-employed and landlords concerns the timing of Income Tax payments. This is because from April 2029, the Government intends to require taxpayers who currently make payments on account to make smaller, more regular payments towards their annual Income Tax liabilities.
The intention is to bring tax payments closer to the point at which income is earned, rather than relying on the existing twice-yearly payments on account.
The Government will consult further on the implementation of these changes. At Tax Driven Accountants, we’ll keep a close eye on this and any other self assessment updates, as we near the next deadline for 31st January 2027.
For guidance on self assessment tax returns, changes following the autumn budget 2026, and how to do your return, enquire about our services here.
VAT and tax administration changes in the Autumn budget 2026
From 1st April 2029, the Government intends to require VAT invoices to be issued in a specified electronic format, and you will be able to access further details of the requirements when they are published in April 2028.
The Government has also confirmed that, from October 2027, VAT online marketplace liability rules will be extended to UK businesses. Online marketplaces will become responsible for collecting VAT on relevant sales by UK VAT-registered businesses and other UK businesses with annual sales of at least £90,000 per platform. Personal sales, second-hand goods and business-to-business transactions will be excluded.
From April 2029, businesses will also be required to establish Direct Debit arrangements for VAT and PAYE liabilities. Other payment methods will remain available, but HMRC will be able to collect outstanding amounts by Direct Debit where payment has not been made by the required cut-off date.
The Budget also announces further investment in HMRC compliance activity, including the recruitment of an additional 670 compliance officers by 2029/30.
New requirements for correcting inaccuracies identified in tax returns and other documents are expected to take effect from April 2028. HMRC is also consulting on the collection and use of third-party property income information.
For guidance on VAT, please get in touch with our specialist accountants.
Capital Gains Tax and business taxation
The lifetime limit for Business Asset Disposal Relief will be reduced from £1 million to £500,000 for qualifying disposals made from 6th April 2027. The rate of relief remains at 18%.
A separate Founders’ Relief will be introduced from April 2027, offering a 10% Capital Gains Tax rate on up to £10 million of qualifying lifetime gains for founders of certain high-growth, innovative companies. The detailed eligibility requirements remain subject to consultation.
There are also changes to capital allowances. The main rate writing down allowance will fall to 12% from April 2027, while the main rate first-year allowance will increase from 40% to 50% for qualifying expenditure incurred from 1st January 2027.
Other announcements in the Autumn budget 2026
For this budget, John Healey and the Government has confirmed that the tax-free business mileage allowance of 55p per mile for the first 10,000 miles, introduced from April 2026, will become permanent. The rate for mileage exceeding 10,000 miles will increase from 25p to 35p from April 2027.
For qualifying retail, hospitality and leisure properties in England, the threshold for 100% Small Business Rate Relief will increase from a rateable value of £12,000 to £18,000 in April 2027. The upper threshold for tapered relief will increase to £21,000.
The National Living Wage will also increase to £13.21 per hour from April 2027.
For individual taxpayers, the Government has confirmed that the annual cash ISA subscription limit will remain at £20,000. A new Pension Tax Allowance will also be introduced from April 2027, intended to prevent pensioners whose only income is at or below the full new State Pension from becoming liable to pay small amounts of Income Tax.
Further information following the Autumn budget 2026
The Budget contains a number of measures which will require further legislation, consultation or guidance before they take effect. It’s always important to stay up-to-date and contact an accountant if you’re unsure on how these changes will apply to you or your business.
Get in touch with Tax Driven Accountants today, call us on 0800 999 1800 or send us an enquiry to get the support you need.
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Budget source
You can read the full Budget document here using the link here (to the Chancellor’s red book).
