Autumn Budget 2026: What It Means for Company Owners
The Autumn Budget 2026, delivered on 28 October 2026, left the headline rates of income tax, National Insurance, dividend tax and corporation tax where they were. Most of what did change arrives on 6 April 2027: higher tax on property and savings income, a smaller Business Asset Disposal Relief limit, and changes to capital allowances, including the end of the 100% allowance on new electric company cars. A second wave of payment and reporting changes follows in April 2029. This is our Autumn Budget 2026 summary for owner-managed companies, their directors and landlords; the larger items have their own articles.
What the Autumn Budget 2026 left unchanged
For a typical owner-managed company, the core numbers for 2027/28 are the ones you already plan around.
Corporation tax stays at 25%, with the 19% small profits rate and marginal relief between £50,000 and £250,000. Both rates have been confirmed for the financial year starting 1 April 2028.
Dividend tax does not rise again. The 2026/27 rates of 10.75%, 35.75% and 39.35% continue into 2027/28, and the £500 dividend allowance is unchanged.
The personal allowance stays at £12,570 and the higher-rate threshold at £50,270 until 5 April 2031. Frozen thresholds are a tax rise that never appears in a Budget speech: as pay and profits rise with inflation, more income is taxed at 40% each year. The £100,000 point at which the personal allowance starts to taper is unchanged too.
Capital gains tax stays at 18% and 24%, with a £3,000 annual exempt amount. Employer National Insurance stays at 15% above £5,000 a year, the Employment Allowance at £10,500, and employee rates at 8% and 2%.
The pension annual allowance stays at £60,000 and income tax relief on contributions is unchanged. So is the £20,000 cash ISA limit, which had been due to fall for savers under 65 from April 2027.
One thing that did not happen is welcome. HMRC had consulted on making close companies report their transactions with shareholders — payments, loans and asset transfers. The government has said it will not implement the new reporting requirements at this time.
What changes on 6 April 2027 after the Autumn Budget 2026
Most of the Autumn Budget 2026's practical effect lands at the start of the 2027/28 tax year.
| Change | What happens | Who it affects |
|---|---|---|
| Property income rates | 24%, 44% and 49%, up from 20%, 40% and 45% | Individual landlords in England, Wales and Northern Ireland |
| Savings income rates | 24%, 44% and 49% across the UK | Anyone with interest above their personal savings allowance |
| Order of allowances | Personal allowance set against salary, pension and trading income first | Landlords and savers with modest other income |
| Business Asset Disposal Relief | Lifetime limit falls from £1m to £500,000 | Owners selling a business or shares |
| Founders' Relief (proposed) | 10% on up to £10m of lifetime gains | Founders of high-growth companies |
| Trading allowance | Rises from £1,000 to £3,000 | Small side income from trading |
| Making Tax Digital | Extends to qualifying income over £30,000 | Sole traders and landlords |
| Pensions and inheritance tax | Unused pension funds come into the estate | Anyone with pension savings |
The property and savings increases combine the two points announced at Budget 2025 with two more announced in the Autumn Budget 2026. The personal savings allowance (£1,000 for basic-rate taxpayers, £500 for higher-rate) is unchanged, so ISAs become more valuable for anyone holding cash outside them.
The ordering rule is the quiet one. From 2027/28 the personal allowance has to be used against employment, pension and trading income before property, savings or dividend income. For someone with a small salary and substantial rents, that moves income into the higher property rates and can cost several hundred pounds a year on its own. Our landlord tax changes article works through an example.
Pensions coming into the inheritance tax estate from 6 April 2027 was legislated earlier and goes ahead unchanged. Wills and pension expression-of-wish forms are worth reviewing before then.
Capital allowances, electric company cars and employers
Capital allowances move in two directions. From 1 January 2027, the first-year allowance on new main-rate plant and machinery rises from 40% to 50%. Companies already get 100% on most new plant through full expensing and the £1m Annual Investment Allowance, so the new rate matters mainly to unincorporated businesses spending above the AIA and to leasing businesses. From 1 April 2027 for companies, and 6 April 2027 for unincorporated businesses, the writing-down allowance on the main pool falls from 14% to 12%, which slows relief on any balance already there.
Electric company car tax relief loses its special treatment. The 100% first-year allowance on new zero-emission cars ends on 31 March 2027 for companies and 5 April 2027 for sole traders and partnerships, and the Budget did not extend it. A car bought after that goes into the main pool at 12% a year. On a £45,000 car bought by a company paying 25%, that is the difference between £11,250 of electric company car tax relief in the first year and £1,350. Cars qualify for neither the AIA nor full expensing. Charge points also lose the 100% allowance, but as plant they will usually still get full relief through the AIA or full expensing.
For employers, mandatory payrolling of benefits in kind begins in April 2027, starting with company cars, fuel, vans and medical benefits. Payroll software and processes need to be ready before the first pay run of 2027/28.
The salary sacrifice change announced last year is unchanged: from 6 April 2029, pension contributions sacrificed above £2,000 per employee per year attract employee and employer National Insurance. Ordinary employer contributions are not affected. Our salary sacrifice pensions article has the numbers.
Selling a business or planning an exit
The Business Asset Disposal Relief rate is already 18% for 2026/27. From 6 April 2027 the lifetime limit halves to £500,000. On a £1m qualifying gain with no previous claims, the tax rises from £180,000 to £210,000. HMRC expects three-quarters of claimants to be unaffected because their gains are under the new limit.
Anti-forestalling rules are proposed for unconditional contracts entered into before 6 April 2027 but completed afterwards, so exchanging early does not automatically preserve the £1m limit. Our Business Asset Disposal Relief article covers the detail.
The proposed Founders' Relief sits at the other end: 10% on up to £10m of lifetime gains, but only for founders who held at least 25% at the start, in companies with at least £10m of turnover, 15 full-time employees and a record of rapid growth or substantial R&D. HMRC estimates about 600 people a year will qualify. Our founders' relief explainer sets out the tests.
Further out, the government is proceeding with a reform of how company distributions are taxed from April 2028, with draft legislation in 2027. Its scope includes purchases of own shares, capital reductions, demergers and loans to participators. Ordinary dividends are not the focus, but anyone planning a buy-back or re-organisation in the next few years should expect the rules to change.
The 2029 payment and reporting changes
The second wave of Autumn Budget 2026 measures changes how tax is paid rather than how much.
From April 2029, every business will need a Direct Debit mandate in place for VAT and PAYE. Paying by another method before the due date remains possible; the Direct Debit collects whatever is still unpaid. Self-assessment taxpayers who make payments on account, mainly the self-employed and landlords, move to automated in-year payments, with an option for eligible taxpayers to pay through PAYE. HMRC also gains a power to recover established lower-value debts in regular instalments directly from bank accounts, introduced in phases starting with companies. Mandatory e-invoicing for VAT starts in April 2029 as well.
None of these raises tax, but all of them reduce flexibility over when cash leaves the business. A company that manages its cash flow by choosing when to pay VAT will need a different approach, and the time to build it is before 2029, not in the first quarter it bites.
Closer to hand, making Tax Digital for Income Tax reaches sole traders and landlords with qualifying income over £30,000 in April 2027. Those joining in 2027/28 will have a year without penalty points for late quarterly updates; this year's joiners lose that easement from August 2027.
If you would like to know which of these Autumn Budget 2026 changes affect you and when to act, our tax services team can go through them against your own figures.
Frequently Asked Questions
Did the Autumn Budget 2026 increase dividend tax?
No. The Autumn Budget 2026 left dividend tax unchanged: the 2026/27 rates of 10.75%, 35.75% and 39.35% continue into 2027/28. The increase that took effect in April 2026 was announced at Budget 2025, and the £500 dividend allowance is unchanged.
When do the new property income tax rates start?
From 6 April 2027, the start of the 2027/28 tax year. Property profits will be taxed at 24%, 44% and 49% in England, Wales and Northern Ireland. Scotland and Wales are being given powers to set their own property income rates, so Scottish figures may differ.
Is the 100% capital allowance on electric company cars ending?
Yes. This electric company car tax relief ends on 31 March 2027 for companies and 5 April 2027 for unincorporated businesses, and the Budget did not extend it. After that, new electric cars receive a 12% writing-down allowance in the main pool under the usual capital allowances rules. What matters is when the expenditure is incurred, which is usually on delivery rather than order.
What should I review before April 2027 after the Autumn Budget 2026?
Three things, if they apply. A business sale or retirement already in progress, because of the BADR limit. A company car purchase planned for the next few months, because of the electric company car tax relief deadline. And rental or savings income alongside a modest salary, because both the rates and the order of allowances change.