Autumn Budget 2026

The Chancellor has delivered the 2026 Autumn Budget. While the package avoided major macroeconomic shocks, several targeted tax adjustments and allowance changes will require careful ongoing planning for savers, landlords, and retirees. 

Changes for business owners

Business owners considering a sale will need to take account of changes to Business Asset Disposal Relief (BADR). The government has announced that, from 6 April 2027, the lifetime limit on gains qualifying for the relief will fall from £1 million to £500,000. The Capital Gains Tax (CGT) rate on qualifying gains will remain at 18%.

If you are considering selling or passing on a business, changes to the tax treatment of a future disposal could affect how much of the proceeds you ultimately retain. An exit is also an important point at which to consider your wider financial position, including how the proceeds might provide future income, support your retirement or form part of your estate planning.

The government is also consulting on a proposed Founders’ Relief, which would offer a 10% CGT rate on up to £10 million of lifetime gains for qualifying founders and early investors. The eligibility rules remain subject to consultation.

Property and savings tax increases

From 6 April 2027, the income tax rates applied to property and savings income will rise by a further two percentage points. This pushes the basic rate to 24%, the higher rate to 44%, and the additional rate to 49%. Separate rates at the same levels will apply to property income in England, Wales and Northern Ireland.

The latest two-percentage-point increase is in addition to the two-percentage-point increase already announced, bringing the combined rise to four percentage points.

If you are a landlord or receive taxable interest on your savings, these changes could reduce the income you have available after tax. This may be a useful opportunity to review how your property income and savings fit into your wider financial plan, including the use of available tax-free allowances. A review does not necessarily mean making changes: any decisions should take account of your income needs, access to cash and longer-term goals.

ISA allowances maintained

In a welcome reversal of previous proposals, the annual Cash ISA allowance will remain at £20,000 following the government’s decision to scrap the planned reduction to £12,000. Savers will therefore retain the option to use their full annual ISA allowance for cash savings.

ISAs can help protect savings interest and investment returns from tax. The right balance between cash and investments will, however, depend on your circumstances, when you might need access to your money and the level of investment risk you are comfortable taking.

New ISA options for first-time buyers and investors

The government has also announced a new First Time Buyer ISA, which will replace the Lifetime ISA for new accounts from 6 April 2029. Until then, it remains possible to open a Lifetime ISA. Existing Lifetime ISA holders will be able to continue saving under the current rules. For those saving towards a first home, understanding the eligibility and withdrawal rules will remain important when choosing an account.

The government has also said it will work with industry to explore a new ISA incentive aimed at encouraging people to begin investing. If you are new to investing, it is important to consider what you are investing for, when you might need the money and the level of risk you are comfortable taking. Investments can fall as well as rise in value.

Tax-efficient saving and investing can play a useful part in your wider financial plan, but the right account will depend on your circumstances and what you want to achieve.

New Pension Tax Allowance

From 6 April 2027, a new Pension Tax Allowance will ensure that people at or above State Pension age whose total income does not exceed the full new State Pension will not pay income tax as State Pension payments rise above the frozen Personal Allowance.

Eligibility will depend on total income, regardless of whether it comes from the State Pension, private pensions or other sources. Those with income slightly above this level may receive a partial reduction, and HMRC will apply the allowance automatically.

If you receive income from several sources in retirement, the allowance will not necessarily remove your tax liability. It remains important to look at your pensions, savings and investments together, taking account of the income you need now and how your money will support you over the longer term.

Trading Allowance increase

From 6 April 2027, the Trading Allowance will increase from £1,000 to £3,000, allowing people with qualifying trading income to earn more before paying income tax on it.

For people receiving modest self-employed or additional trading income, an increased Trading Allowance could simplify their tax position. It remains important to understand which income qualifies and whether there is wider tax or reporting considerations.

Energy bill adjustments

The government has asked Ofgem to abolish gas standing charges in 2027 or as soon as possible after. A new £100 energy payment for households in council tax bands A-D in England will also be paid from January 2027. Together, these will provide some breathing space, though shifting to unit-based pricing means heavier energy users need to remain mindful of winter costs.

What this means for your financial planning

What these announcements mean for you will depend on your circumstances. They may be a useful opportunity to review your financial plan and consider whether it continues to support your needs and longer-term goals.

If you would like to discuss the potential impact on your retirement income, estate planning or investments, please get in touch.