The Autumn Budget 2026
Chancellor John Healey delivered his first Autumn Budget today, outlining a number of measures affecting personal finances, savings, property and businesses.
We've summarised the key announcements and what they could mean for your financial planning.
Source: The Guardian
ISA ALLOWANCES
On a positive note, the planned cut to the cash ISA allowance has been scrapped, so the full £20,000 annual allowance remains available for cash savings. The government also plans to work with the industry on a new “Starter ISA” for first-time investors, with more details to follow.
PENSIONS
Whilst Pension tax relief and the tax-free lump sum remain unchanged. As previously announced, unused pension funds will be included in estates for inheritance tax purposes from April 2027, and the minimum age for accessing most private pensions will rise from 55 to 57 in April 2028. Pensions being included within estates will have a big impact on how benefits should be taken as well as creating further planning opportunities to mitigate any inheritance tax liability. This is particularly pertinent if you are approaching retirement or already retired.
The full new state pension will increase to £13,036 from April 2027. From 2030, annual increases will be linked to the higher of inflation or 2.5%, rather than earnings growth.
PROPERTY, SAVINGS & DIVIDEND INCOME
Tax on savings interest and on rental income from personally held property will rise by a further 2 percentage points from April 2027. The Personal Savings Allowance means most savers will not be affected, although larger cash balances held outside ISAs and pensions may be. Dividend tax rates remain unchanged.
The annual charge on homes valued above £2m will go ahead as planned from 2028, with the threshold unchanged. A new “Your First Home” scheme will also support first-time buyers of new-build homes with a 2.5% deposit and a 20% government equity loan, which may be of interest if you are helping family members onto the property ladder.
INCOME TAX
Income tax rates on earnings remain unchanged, and the freeze on income tax thresholds continues until 2031.
CAPITAL GAINS TAX
CGT rates remain at 18% and 24%. Whilst these are higher than they have been in the recent past, given the rumours about the Chancellor increasing them, it’s pleasing to see them stay the same.
BUSINESS OWNERS
The lifetime limit for Business Asset Disposal Relief has been reduced from £1m to £500,000 from April 2027. This is particularly relevant if you are considering the sale of a business.
Full expensing for qualifying business investment remains in place, and the first-year allowance on other plant and machinery will increase from 40% to 50%. The 55p per mile tax-free mileage rate for the first 10,000 business miles has also been made permanent.
Should you have any questions, please do not hesitate to contact us.
This summary is for information only and does not constitute personal financial advice. Budget measures may change before becoming law.
Recent in news
