The Chancellor delivered the Autumn Budget on 28 October 2026, with a mixture of support for households and businesses alongside some targeted tax increases.

Although there were no increases to the headline rates of Income Tax, National Insurance or VAT, there are a number of important changes which could affect business owners, landlords, savers and individuals over the next few years.

Here are some of the main announcements.

Changes for landlords

From 6 April 2027, the rates of Income Tax applying to property income will increase by two percentage points.

This means the property income tax rates will be:

• 24% for basic-rate taxpayers
• 44% for higher-rate taxpayers
• 49% for additional-rate taxpayers.

For individual landlords, this will make it even more important to consider the tax implications of property ownership and whether their existing structure remains appropriate.

Business Asset Disposal Relief reduced

A significant announcement for business owners is the reduction in the lifetime limit for Business Asset Disposal Relief (BADR).

The limit will fall from £1 million to £500,000 for qualifying disposals made from 6 April 2027.

If you are already considering selling, closing or passing on your business, this is something worth discussing with us before taking any action.

Changes to capital allowances

There are also changes to the tax relief available when businesses invest in qualifying equipment.

The main writing down allowance will reduce to 12% from April 2027, while the First Year Allowance will increase to 50% for qualifying expenditure from 1 January 2027. Full expensing for qualifying companies remains available.

The timing of larger purchases may therefore be worth considering as part of your tax planning.

A higher Trading Allowance

From 6 April 2027, the Trading Allowance will increase from £1,000 to £3,000.

This could be particularly helpful for individuals with small amounts of trading or miscellaneous income.

Making Tax Digital

There was also some welcome breathing space for people entering Making Tax Digital for Income Tax.

Taxpayers joining MTD from April 2027 will not receive penalty points for late submission of their first four quarterly updates during 2027/28.

The government has also deferred the introduction of MTD for a number of taxpayer groups until further notice.

Further ahead, from April 2029 taxpayers who currently make Self Assessment payments on account will move towards making smaller, more frequent payments during the year.

Mandatory VAT e-invoicing

VAT-registered businesses will also need to prepare for another major change.

From 1 April 2029, VAT invoices will have to be issued in a specified electronic format, with the full technical details due to be published by April 2028.

This is likely to make suitable accounting software increasingly important for businesses over the next few years.

More generous mileage rates

The tax-free mileage rate for employees and self-employed people using their own cars or vans for business has increased.

The rates will be:

• 55p per mile for the first 10,000 business miles
• 35p per mile thereafter.

This is a welcome increase for those who cover significant business mileage.

Minimum wage increases

From 1 April 2027, the National Living Wage will rise by 3.9% to £13.21 per hour.

The National Minimum Wage will increase to £11.27 for 18 to 20-year-olds and £8.31 for 16 to 17-year-olds and eligible apprentices.

Employers should therefore make sure these increases are included in payroll and staffing budgets for 2027/28.

Business rates support

There is further support for businesses in the retail, hospitality and leisure sectors.

From April 2027, qualifying businesses in England will receive 100% Small Business Rate Relief where the rateable value is up to £18,000, with tapered relief available up to £21,000.

Business rates bills for qualifying retail, hospitality and leisure properties will also receive additional protection over 2027/28 and 2028/29.

Savings income tax increases

From 6 April 2027, the Income Tax rates applying to savings income will rise by two percentage points to 24%, 44% and 49%.

However, the Government has confirmed that the annual cash ISA allowance will remain at £20,000.

Support with energy and fuel costs

For households, the temporary 0% VAT rate on domestic electricity will continue until 1 July 2027, which the Government estimates will reduce the annual Ofgem price cap by around £50 in April 2027.

Households in Council Tax bands A-D in England will also receive a £100 Household Energy Payment from January 2027.

The temporary 5p-per-litre reduction in fuel duty has also been extended until 1 July 2027.

A new scheme for first-time buyers

The Budget introduces a new Your First Home scheme, backed by £4.7 billion.

The scheme will offer qualifying first-time buyers government equity loans of up to 20% of the purchase price, with a reduced deposit requirement and a five-year interest-free period. Applications are expected to open from February 2027.

A new First Time Buyer ISA is also planned from April 2029, offering a 25% government bonus towards a qualifying first home.

What should you do now?

As always, the headline announcements do not tell the whole story. Some of the changes do not take effect until 2027, 2028 or 2029, but there may be opportunities to plan ahead.

In particular, we would recommend speaking to us if you are:

• considering selling or closing a business
• a landlord concerned about the increased tax rates
• planning a significant business investment
• approaching Making Tax Digital
• considering buying your first home
• or simply want to understand how the Budget affects you personally.

If you would like to discuss any of the Budget announcements and how they could affect you or your business, please get in touch with the team at Towers + Gornall.

This article is intended as a general summary of the October 2026 Budget and should not be treated as individual tax advice.