Autumn Budget 2026 Explained: What It Means for Your Business

Written by the ChadSan tax team. Reviewed by our Head of Tax. Last updated 29 October 2026.

Budget headlines are written for people who already speak tax. This guide isn’t. We’ve gone through every announcement that matters to business owners and explained it in plain English: what changed, who it affects, when it starts, and what you should actually do about it.

The Autumn Budget 2026 at a glance

What the Budget means for you

Not every change affects every business. Find the one that sounds like you, then jump to the detail below.

Selling your business: Founders’ Relief and Business Asset Disposal Relief

When you sell a business, or shares in one, you usually pay Capital Gains Tax on the profit you make. Two reliefs can lower that bill, and both changed.

• Business Asset Disposal Relief is shrinking. It lets owners pay a lower rate (18%) on gains when they sell. From 6 April 2027, it only covers the first £500,000 of gains in your lifetime, down from £1 million. That cuts the most it can save you from £60,000 to £30,000.
• Founders’ Relief is brand new. From 6 April 2027, founders and significant early investors in high growth, innovative companies could pay just 10% on up to £10 million of gains over their lifetime. The proposed conditions include owning at least 25% of the company at the start and holding your shares for five years. It’s still subject to consultation, so the final rules may change.

What to do: if you’re planning to sell in the next year or two, the timing now matters. Sales before 6 April 2027 still get the £1 million limit. But don’t rush a sale just for tax reasons. Talk it through first, because Founders’ Relief could be the better route for the right business.

Rewarding your team: share options get bigger

Share options let you give staff the right to buy shares in your company later, at today’s price, with tax advantages. They’re one of the best ways for a growing business to attract and keep great people without paying huge salaries.

• The Company Share Option Plan (CSOP) is renamed EMI2 from 6 April 2027.
• The most each employee can hold doubles from £60,000 to £120,000.
• Staff get up to 15 years to use their options, up from 10.
• The limits for EMI and EMI2 no longer eat into each other, so you can use both more freely.

For tech and AI businesses and games studios competing for talent, this is one of the most useful changes in the whole Budget.

Employers: wages, mileage and perks

• National Living Wage: rises 3.9% from £12.71 to £13.21 an hour from 1 April 2027. That’s roughly £910 more a year for a full time worker. The rate for 18 to 20 year olds rises from £10.85 to £11.27.
• Mileage: the 55p a mile rate for the first 10,000 business miles in a car or van is now permanent. Above 10,000 miles, it rises from 25p to 35p from 6 April 2027.
• Perks on payroll: the Budget confirmed that tax on company cars, vans, fuel and private medical cover moves to payroll from 6 April 2027. We explain exactly what that means in our guide to the P11D changes in 2027.
• Company cars further ahead: company car tax rates rise by one percentage point in 2030/31, with electric cars moving from 9% to 10%.

Buying equipment: capital allowances

Capital allowances are how a business gets tax relief when it buys things like machinery, computers or vans. Think of them as a discount on your tax bill for investing in the business.

• The good news: the first year allowance for main rate assets rises from 40% to 50% for spending from 1 January 2027. Full expensing for companies and the £1 million Annual Investment Allowance both stay.
• The catch: the yearly writing down allowance on what’s left falls from 14% to 12% from April 2027, so relief on older assets comes through more slowly.

If you’re planning a big purchase, when you buy it now makes a real difference to your tax. It’s worth taking the time to plan the cash properly before you commit.

Shops, pubs and cafés: business rates relief

Business rates are the tax businesses pay on the property they use. In England, from 1 April 2027:

• Small business rates relief now covers properties with a rateable value up to £18,000 (up from £12,000), with partial relief up to £21,000. The government says around 70,000 more businesses will pay no rates at all.
• Pubs, social clubs and most live music venues get 35% off their rates, up from 15%.
• Increases for other eligible retail, hospitality and leisure properties are capped at inflation for two years.

If you sell through Amazon, eBay or similar, note this too: from 1 October 2027, online marketplaces will collect VAT on sales by UK sellers who are VAT registered or sell more than £90,000 a year on that platform.

Landlords and savers: higher tax on rent and interest

From 6 April 2027, tax on savings interest and rental income rises to 24% for basic rate taxpayers, 44% for higher rate and 49% for additional rate. The rental income rates apply in England, Wales and Northern Ireland. On the plus side, the planned cut to the cash ISA allowance was scrapped, so you can still put £20,000 a year into ISAs.

If you own property personally, this could be the moment to look at whether that’s still the right structure for you.

Side income and sole traders

The trading allowance triples from £1,000 to £3,000 from 6 April 2027. That means you can earn up to £3,000 a year from a side business or freelance work without paying tax on it or filing a Self Assessment return for it.

There’s also some relief for anyone starting Making Tax Digital. People earning over £50,000 won’t get penalty points for late quarterly updates in 2026/27, and those earning over £30,000 won’t get them in 2027/28. Your year end return still has to be on time, though.

Less admin (for once)

• R&D tax relief: the claim notification form is scrapped for claims made from 1 April 2027, and the additional information form gets simpler from autumn 2027.
• Companies House: the plan to make small and micro companies publish their profit and loss account has been paused.
• Self Assessment: from April 2029, the two big payments on account will move to smaller, more regular payments, and people on PAYE can choose to pay through their payslip.

What didn’t change

Just as important as what changed is what stayed put:

• Corporation tax stays at 25%, with the 19% small profits rate unchanged.
• The main rates of income tax on wages stayed the same.
• No change to the VAT rate or the £90,000 VAT registration threshold.
• The dividend tax rises announced last year still go ahead (read our breakdown of the dividend tax changes).
• Business energy bills weren’t included in the household energy support.

What to do now

1. Planning to sell? Work out whether to sell before 6 April 2027 or wait for Founders’ Relief.
2. Update your wage budget for the April 2027 National Living Wage rise.
3. Review your share scheme. If you offer options, the new limits could let you reward key people far more.
4. Time big purchases to make the most of the 50% first year allowance from January 2027.
5. Check your rates bill. If your property’s rateable value is under £21,000, you may pay less or nothing from April 2027.
6. Get payroll ready for perks moving onto payroll in April 2027.
7. Don’t react to headlines alone. Several measures are still being consulted on, so get advice based on your own numbers.

Frequently asked questions

When was the Autumn Budget 2026?

The Autumn Budget 2026 was delivered on Wednesday 28 October 2026 by Chancellor John Healey. It was his first Budget. Most of the tax changes announced start in April 2027.

Did income tax go up in the Autumn Budget 2026?

Not on wages. The main income tax rates on earnings stayed the same. But tax on savings interest and rental income rises to 24%, 44% and 49% from 6 April 2027, depending on which tax band you’re in.

Did corporation tax change?

No. Corporation tax stays at 25% for larger profits and 19% for small profits. The changes for companies are to capital allowances: a 50% first year allowance from January 2027 and a lower 12% writing down allowance from April 2027.

What is Founders’ Relief?

Founders’ Relief is a new Capital Gains Tax relief starting 6 April 2027. Qualifying founders and early investors in high growth, innovative companies could pay 10% on up to £10 million of lifetime gains when they sell. The rules are still being consulted on.

What happened to Business Asset Disposal Relief?

Its lifetime limit halves from £1 million to £500,000 for sales on or after 6 April 2027. The 18% rate stays, but the most it can save you falls from £60,000 to £30,000.

How much is the National Living Wage from April 2027?

£13.21 an hour for workers aged 21 and over, up 3.9% from £12.71. The rate for 18 to 20 year olds rises to £11.27 an hour. Both start on 1 April 2027.

Did the VAT threshold change?

No. The VAT registration threshold stays at £90,000 and the standard VAT rate is unchanged. From 1 October 2027, though, online marketplaces will collect VAT on sales by bigger UK sellers.

What is the new trading allowance?

From 6 April 2027, you can earn up to £3,000 a year from self employment or side income tax free, up from £1,000. Below that amount, you won’t need to register for Self Assessment for that income.

How ChadSan can help

A Budget only matters when you know what it means for your own numbers. Our team turns the headlines into a plan for your business: what to change, what to time carefully and what you can safely ignore.

We work with businesses from our offices in South London, Essex, Guildford and Bristol, and clients right across the UK. You can also see our pricing before you get in touch.

Sources: HM Treasury, Autumn Budget 2026 (28 October 2026), as summarised by PwC, TaxAssist Accountants, Saffery and Bishop Fleming. Some measures are subject to consultation and legislation. This guide is general information and not personal tax advice.