Autumn Budget 2026: What It Means for You and Your Business

The Autumn Budget 2026 brings important tax and cost changes for small businesses, sole traders and landlords. The Chancellor delivered the Budget on 28 October 2026. There is no single change that turns everything upside down, but several announcements could affect your cash flow, tax planning and payroll.

Most of the measures covered here are scheduled for 2027, with bigger changes to how you pay HMRC planned for April 2029. That gives you time to plan, as long as you know what is coming.

We have sorted the announcements by who they affect, so you can skip straight to the parts that matter to you. This guide is based on the official Budget documents published on 28 October 2026. An announcement is not the same as enacted law: some measures still require legislation, and others are subject to consultation or detailed design.

Autumn Budget 2026 at a glance

If you are a sole trader or freelancer

A bigger trading allowance from April 2027

The government plans to increase the trading allowance from £1,000 to £3,000 from 6 April 2027, alongside an increase in the trading-income reporting threshold for Self Assessment. This could simplify the position for eligible people with a small side business or miscellaneous income.

Where the allowance covers all your relevant income before expenses and you qualify for it, that income need not be declared or taxed under the allowance rules. Do not assume the change removes every registration or reporting obligation: exclusions and other reasons to file a return can still apply.

If your relevant income exceeds the allowance, compare claiming the allowance with claiming your actual expenses and capital allowances. You cannot claim both against the same income. Our sole trader accounting support can help you work out which approach fits your figures.

Making Tax Digital extends to more people

If your combined gross qualifying self-employment and property income was over £30,000 in 2025/26, you will need digital records, compatible software and quarterly updates from 6 April 2027, unless an exemption applies. The threshold is before expenses, not profit, and the income test applies to each individual.

The Budget announces that HMRC will not apply late-submission penalty points to quarterly updates for 2027/28 for taxpayers required to join MTD in April 2027. You still need to send those updates before submitting your tax return. This is not a general exemption from late-payment penalties or all filing penalties.

If you joined MTD in April 2026, do not assume the new April 2027 entrant concession applies to you. Read our Making Tax Digital guide and check your own start date and obligations.

More regular Self Assessment payments from 2029

The government plans to require taxpayers who make payments on account to make more regular automated in-year payments from April 2029, with eligible taxpayers able to choose payment through PAYE. HMRC has consulted on the approach and will continue working on the detailed design and implementation.

This may change how you budget for tax, but it does not cancel any current payment. Keep following your existing January and July deadlines until the replacement rules apply, and keep putting money aside throughout the year.

Parental support for the self-employed

From April 2029, the government plans to extend parental pay to eligible self-employed fathers, partners and adopters in Great Britain. Some recently employed or unemployed people, and people with irregular employment who do not qualify for statutory paternity or adoption pay, may also benefit where the work and earnings conditions are met.

The detailed eligibility and payment rules will matter. Do not budget for a particular weekly amount until the applicable scheme rules are confirmed.

If you employ people

Minimum wage increases from 1 April 2027

The announced National Living Wage for workers aged 21 and over rises from £12.71 to £13.21 an hour. The National Minimum Wage for 18 to 20-year-olds rises from £10.85 to £11.27 an hour. Both increases take effect on 1 April 2027.

Build the increases into your staffing budget, including any effect on employer costs and pay differentials. Other age groups and apprentices have separate rates. Our payroll service can help you discuss the changes affecting your team.

Direct Debit arrangements for VAT and PAYE

The government plans to require a Direct Debit instruction for VAT and PAYE return liabilities from April 2029, subject to defined exceptions. The Budget tax overview says businesses can still pay by another method before a specified cut-off date, with Direct Debit used to collect unpaid balances.

Legislation and implementation details are still to follow. Keep your current payment arrangements in place and check the final cut-off dates rather than assuming every alternative payment can be left until the due date.

More generous employee share options

The Company Share Option Plan, renamed EMI2, is being expanded. The announced individual option limit rises from £60,000 to £120,000, and the exercise period extends from 10 to 15 years. The interaction between the CSOP and EMI individual limits is also being removed.

The Budget tax overview gives 6 April 2027 as the start date for these legislative changes. Share schemes have detailed conditions, so take specialist advice before offering options or changing an existing plan.

If you run a limited company or are thinking of selling

Capital allowances are changing in both directions

The government announces an increase in the main rate first-year allowance from 40% to 50% for qualifying expenditure incurred on or after 1 January 2027.

At the same time, the main rate writing-down allowance falls from 14% to 12% from 1 April 2027 for Corporation Tax and 6 April 2027 for Income Tax.

These changes do not mean every equipment purchase gets the same relief. The asset, the business and other available allowances can change the answer. If you are planning to buy equipment, compare the available reliefs and commercial timing before moving a purchase solely for tax reasons.

Our limited company accounting packages include accounts and tax support for owner-managed businesses in Cornwall and South West England.

Business Asset Disposal Relief limit is being reduced

For qualifying disposals on or after 6 April 2027, the Budget announces a reduction in the Business Asset Disposal Relief lifetime limit from £1 million to £500,000.

This is a limit on qualifying lifetime gains, not the sale price of your business. Special provisions apply to some contracts entered into before the start date and to certain share reorganisations and exchanges. Signing a contract early does not automatically secure the old limit.

If you are considering a sale, get advice on the transaction and your previous use of the relief before deciding whether to bring anything forward.

A proposed relief for high-growth founders

The government has announced Founders' Relief, proposing a 10% Capital Gains Tax rate on up to £10 million of qualifying lifetime gains for founders of eligible high-growth, innovative companies, for disposals on or after 6 April 2027.

The eligibility rules are being consulted on. Do not assume an ordinary small business sale will qualify, or treat the proposed relief as a settled alternative to Business Asset Disposal Relief.

Company profits and shareholder paperwork

The government says it will not implement the proposed new reporting requirements for company payments to participators at this time. That does not remove existing obligations around salary, dividends, directors' loans or company records.

Before taking profits out of a company or winding it up, ask for advice based on the transaction and the rules that apply at the time. A capital-gains treatment cannot simply be assumed.

If you have rental or savings income

The Budget sets out property and savings income tax rates of 24%, 44% and 49% from 6 April 2027. These are a further two percentage points above the previously announced 22%, 42% and 47% rates.

For property income, the new rates apply in England, Wales and Northern Ireland. Savings rates apply across the UK. Your actual liability depends on taxable income, tax bands, allowances and reliefs; these percentages are not a tax on every pound of gross rent or savings interest.

If you are a landlord, review your allowable expenses, finance costs and ownership arrangements with your accountant. Moving a property into a company can create tax and legal costs of its own, so it is not an automatic solution to higher personal tax rates.

Explore our landlord tax and MTD support if you want help understanding your position.

Running costs: mileage, fuel and business rates

Business mileage rates

The 55p per mile rate for the first 10,000 business miles in a tax year, introduced for 2026/27, is being made permanent. From 6 April 2027, the rate for qualifying miles above 10,000 rises from 25p to 35p.

These are the car and van rates for Approved Mileage Allowance Payments and self-employed simplified mileage. Eligibility and the distinction between genuine business travel and private travel still matter. Keep a mileage log showing dates, journeys, business purpose and miles, and do not assume you can claim both mileage and the same actual vehicle costs.

Fuel duty

The Budget extends the fuel-duty freeze and temporary 5p cut until 1 July 2027. Do not assume the extension continues beyond that date when planning longer-term transport costs.

Business rates in England

For qualifying retail, hospitality and leisure properties, the Budget increases the threshold for 100% Small Business Rates Relief from £12,000 to £18,000, and the upper threshold for tapered relief from £15,000 to £21,000, from April 2027. These are rateable-value thresholds, not turnover limits, and eligibility conditions still apply.

The government also announces a real-terms freeze, rather than a universal cash freeze, for qualifying retail, hospitality and leisure bills in 2027/28 and 2028/29. A real-terms freeze does not mean every bill stays at exactly the same number of pounds.

Qualifying pubs, social clubs and live music venues receive an additional 20 percentage points of relief, bringing total relief to 35% for 2027/28 and 2028/29 under the announced package. Check your property's eligibility and council bill rather than assuming every hospitality venue receives the same treatment.

For Cornwall's seasonal shops, cafés, pubs and visitor businesses, these changes make it worth reviewing your premises costs alongside payroll and winter cash flow.

What to do now after Autumn Budget 2026

• Planning to sell your business? Review the proposed Business Asset Disposal Relief limit and any transitional rules with your adviser.
• Buying equipment? Compare allowances and commercial timing before and after 1 January 2027.
• Qualifying income over £30,000? Check your 2025/26 gross self-employment and property income and prepare for MTD from April 2027.
• Employing staff? Update your wage budget for 1 April 2027 and check the complete minimum-wage rate table.
• Got a small side income? Review whether the announced £3,000 trading allowance applies to you from 6 April 2027.
• Receiving rent or savings interest? Model the proposed 2027/28 rates against your full income and available reliefs.
• Running a shop, pub or visitor business? Check the business rates conditions for your premises rather than relying on the headline thresholds.
• Paying HMRC? Keep following current deadlines while the April 2029 payment changes are developed.

How Kernow Accountancy can help

Budgets are full of detail, and the right move depends on your own circumstances. Our family-run team in Helston can discuss what these announcements mean for your bookkeeping, payroll, tax returns and business plans across Cornwall.

Book your free chat to talk through the changes that matter to you. If you run an owner-managed limited company, you can also request a free 20-minute chat with Zoe.

Official sources and further reading

• HM Treasury: Budget 2026 in full.
• HM Treasury: Budget 2026 document.
• HMRC: Budget 2026 overview of tax legislation and rates.
• HMRC: Budget 2026 rates and allowances.
• HMRC: check eligibility for MTD for Income Tax.
• HM Treasury: Founders' Relief technical consultation.
• Government: business rates Budget package for 2027/28.

This article is based on the Budget announcements and our understanding on 28 October 2026. Some measures require legislation or are subject to consultation and detailed design, so the rules may change. It is general information, not personal tax advice. Please speak to us before acting on it.