The Chancellor delivered the Autumn Budget on 28 October 2026. There are no rises in the headline rates of Income Tax, National Insurance, VAT or Corporation Tax. There are changes that affect small businesses, and most start on or after 6 April 2027.
This post covers the main ones, who they affect and when. Nothing here needs action today, but some changes are worth planning for.
Sole traders and the self-employed
Trading allowance rises from £1,000 to £3,000 from 6 April 2027. If your total trading or miscellaneous income is £3,000 or less, you will not need to report that income to HMRC, though you may still need to file a tax return for other reasons. Above that, you can deduct £3,000 instead of your actual expenses.
Mileage rates. The 55p rate for the first 10,000 business miles in a year applies from 6 April 2026, as announced in May. From 6 April 2027 the rate above 10,000 miles goes up from 25p to 35p. This covers cars and vans used by sole traders, partners and employees.
Making Tax Digital for Income Tax. If you have to join from April 2027, there are no late submission penalties on quarterly updates for 2027-28. You still need to send the updates before your tax return, and late return penalties still apply.
Payments on account. From the 2029-30 tax year, people who make payments on account are expected to pay automatically during the year. The detailed design is still being worked out. Where you have enough PAYE income, you can pay through PAYE.
Landlords
Property income tax rates rise from 6 April 2027 to 24% basic rate, 44% higher rate and 49% additional rate. This covers individual and partnership landlords in England, Wales and Northern Ireland. Scotland sets its own rates.
Finance cost relief for mortgage interest stays linked to the property basic rate.
Savings income is taxed at the same new rates, 24%, 44% and 49%, across the whole UK from 6 April 2027. Interest inside your Personal Allowance, Personal Savings Allowance, starting rate for savings or an ISA is not affected.
The cash ISA limit stays at £20,000.
Company owners
Corporation Tax stays at 25% main rate and 19% small profits rate.
Dividend tax rates stay at 10.75%, 35.75% and 39.35%, with the £500 Dividend Allowance unchanged.
Capital allowances. The first-year allowance for new main rate plant and machinery rises from 40% to 50% for spending from 1 January 2027. It does not cover cars or second-hand assets. The main rate writing down allowance falls from 14% to 12% from April 2027. The £1 million Annual Investment Allowance and full expensing for companies stay.
Electric company cars. The 100% first-year allowance for new zero-emission cars and chargepoints ends on 31 March 2027 for companies and 5 April 2027 for sole traders and partnerships. It was not extended.
Business Asset Disposal Relief. The lifetime limit falls from £1 million to £500,000 for disposals from 6 April 2027. The rate stays at 18%.
Taking money out of your company. From 6 April 2028, the rules change so that some ways of extracting profit, now taxed as capital gains, are taxed as dividends. Genuine sales, family succession and demergers keep capital gains treatment. Draft rules follow in 2027.
Employers
Minimum wage rates rise from 1 April 2027:
21 and over (National Living Wage): £13.21 an hour
18 to 20: £11.27 an hour
16 to 17 and apprentices: £8.31 an hour
Employer National Insurance stays at 15%, with the Employment Allowance at £10,500.
Benefits in kind. Company cars, vans, fuel and medical benefits must be reported through payroll from 6 April 2027. Most other benefits follow from 6 April 2028.
Other changes
Private hire VAT. From 2 January 2028, larger private hire operators will charge VAT on the full fare. The turnover threshold is still to be consulted on, with £50 million the lead option.
Business rates in England. From 1 April 2027, qualifying retail, hospitality and leisure properties get full Small Business Rate Relief up to £18,000 rateable value, tapering to nil at £21,000. For other small businesses the limits stay at £12,000 and £15,000.
Online marketplaces will collect VAT on sales to consumers from 1 October 2027. This covers VAT-registered UK sellers, and other UK sellers whose sales on a platform are over £90,000 a year. Second-hand goods, business-to-business sales and private sales are excluded.
VAT and PAYE by direct debit will be needed for return payments, from 1 April 2029 for VAT and 6 April 2029 for PAYE. You can still pay by other methods before a cut-off date, and the direct debit collects anything unpaid. There will be some exceptions.
VAT e-invoicing is required from 1 April 2029. Full details are due by April 2028.
Fuel duty. The 5p cut is extended to 30 June 2027.
What to do now
Most of these changes start in April 2027 or later, so there is time to plan. Talk to us if:
you are thinking of selling your business or shares before or after 6 April 2027
you are planning to buy equipment or an electric company car
you let property and want to know what the new rates mean for you
you take money out of your company in ways other than salary and dividends
Summary
The headline tax rates are unchanged. For small businesses the main changes are a higher trading allowance, higher tax on rental and savings income, a lower Business Asset Disposal Relief limit, and new capital allowance rates. Most start from April 2027.
If you would like to know how the Budget affects you, book a call or contact us.