Income tax is to be increased on property and savings income by a further two percentage points. From 6 April 2027 the basic rate for property and savings income will be 24%, the higher rate will be 44%, and the additional rate will be 49%. This means that property and savings income will effectively be taxed at 4% higher than employment income. The savings rates apply across the UK whilst the property rates apply in England and Northern Ireland. The Scottish and Welsh governments have the ability to set their own property tax rates, though the above rates currently also apply to Wales. The 0% starting rate for savings and its £5,000 limit are unchanged. 
 
The Married Couple’s Allowance and the Blind Person’s Allowance will be increased by inflation (CPI), and will. take effect from 6 April 2027. Qualifying Care Relief, the amount of income tax relief available to foster carers and shared lives carers, will also be uprated by CPI.  
 
In a reversal of one of his predecessor’s changes, Healey announced a u-turn on the annual cash Individual Savings Accounts (ISA) subscription limits, which will now remain at £20,000 for all taxpayers.  
 
The Chancellor also announced that the government will work with industry to explore and develop a new ISA incentive for people investing in a stocks and shares ISA for the first time. 
 
No changes to the headline Capital Gains Tax (CGT) rates were announced, nor was an exit tax introduced despite speculation in the press. However, there were some changes to capital gains reliefs for business owners, these are summarised under “Business and enterprise taxation” below.  
 
Finally, the Inheritance Tax (IHT) rules are to be amended to clarify when liabilities relating to trust property may reduce the value of assets for IHT purposes, align the treatment of liabilities affecting trust property with personal liabilities and strengthen anti-avoidance provisions. This will take effect for deaths and other chargeable events occurring on or after 28 October 2026.

A Pension Tax Allowance (PTA) will be introduced, ensuring that pensioners whose total income is up to the value of the full new State Pension do not have the administrative burden of paying small amounts of tax. The allowance will apply from 6 April 2027 until 5 April 2030 and will be uprated in line with the full new State Pension across this Parliament.  
 
Changes will be made to enable the consolidation of Defined Contribution schemes and the introduction of the Guided Retirement framework and Retirement-only Collective Defined Contribution (RCDC) pension schemes. This will include expanding the circumstances when a member may keep certain protections following a transfer and allowing members to transfer from an RCDC pension to a drawdown arrangement within a set timeframe.  
 
The definition of terminal illness will be changed to make it easier for terminally ill individuals to access their pensions savings and allow for overseas registered medical practitioners to provide medical evidence.  
 
The two-year rule will be removed so that beneficiaries will no longer be taxable solely because tax-free pension and lump sum death benefits are paid more than two years after the member’s death. This will apply to any payments made on or after 28 October 2026. 
 
Changes will be made to the way tax is assessed and collected where a deceased member’s lump sum death benefit allowance has been exceeded, supposedly to provide greater certainty to individual beneficiaries but no doubt to also make it easier for the tax to be collected.  

The lifetime limit on gains eligible for Business Asset Disposal Relief (BADR) (which offers a reduced 18% rate of CGT on qualifying disposals) will be reduced from £1 million to £500,000. The new lifetime limit will apply to disposals made from 6 April 2027.  
 
A new Founders’ Relief, providing a 10% CGT rate on up to £10 million of lifetime gains for qualifying founders of high-growth, innovative companies will be introduced from 6 April 2027. Following a technical consultation on the detailed design launched at Budget, the measure will be introduced through the Finance Bill 2026-27.  
 
The Enterprise Management Incentives (EMI) scheme will be simplified by removing the separate notification requirement for EMI option grants. From 6 April 2027, grants will instead be reported through the existing EMI end-of-year return.  
 
The exercise window for individuals holding EMI share options following disqualifying events will be extended from 90 to 180 days so as to provide greater flexibility for employees to retain tax benefits. Companies transitioning to an Employee Ownership Trust (EOT) structure will also retain access to EMI, and shares and share options set aside for employees will be able to be held for 15 years without triggering disguised remuneration rules. These changes will be introduced in Finance Bill 2026-27 and will take effect from 6 April 2027.  
 
From 6 April 2027 the Company Share Option Plan (CSOP) individual option limit will be increased from £60,000 to £120,000, and the interaction with the EMI option limit will be removed, allowing eligible employees to receive the full amount of options available under each scheme. The CSOP exercise period will also be extended from 10 to 15 years. In an attempt to help businesses understand how the schemes fit together, CSOP will be rebranded as EMI2, reflecting its role as an option for growing companies that have moved beyond EMI or are not eligible for EMI.  
 
There will be a small number of technical changes to make the Venture Capital Trust (VCT), Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) easier to use. The government will also strengthen guidance and compliance activity on excessive fees and engage with stakeholders on improving the Advance Assurance service.  
 
From 1 January 2029, a new statutory tax regime will be introduced for foreign sovereigns. This will bring certain real estate income and gains into UK tax, while providing for unique access to Real Estate Investment Trusts for investments in UK real estate.  
 
Legislation will be introduced to increase the main rate first-year allowance to 50% for expenditure incurred on or after 1 January 2027 and to reduce the main rate writing down allowance to 12%, with effect from 1 April 2027 for Corporation Tax and 6 April 2027 for Income Tax.  
 
The Bank Corporation Tax surcharge will be temporarily increased to 6% for 15 months from 1 January 2027 to 31 March 2028, returning to 3% from 1 April 2028.  
 
The R&D tax credit Claim Notification Form will be removed from 1 April 2027, and the Additional Information Form will be simplified from Autumn 2027.  
 
The Trading Allowance will be increased from £1,000 to £3,000, allowing individuals to receive up to £3,000 of trading and miscellaneous income tax-free each year from 6 April 2027.  
 
An administrative easement will be made to the ‘exit charge’ that otherwise applies when a trust ceases to be resident in the United Kingdom in order to make it easier for globally mobile talent to relocate to the UK more quickly. The change will take effect in relation to exit charges on or after 28 October 2026.  
 
In response to a consultation published in June, a mechanism will be created to provide double taxation relief for income received by investors from certain foreign entities such as US Limited Liability Companies and other reverse hybrids where relief is currently unavailable. The government has published a response to the consultation, which sets out more details on the mechanism and further steps for consultation ahead of legislation being included in the Finance Bill 2027-28.  
 
Technical amendments will be made to the Corporate Interest Restriction (CIR) so that from 1 January 2027, the calculation of taxable earnings for CIR will exclude Audio-Visual Expenditure Credits and Video Games Expenditure Credits.

A High Value Council Tax Surcharge (HVCTS) deferral scheme, a series of discounts and exemptions, and a 100% premium on properties left empty and unoccupied for 12 months or more will be introduced. HVCTS applies to England only and this measure will be introduced through the Finance Bill 2026-27.  
 
The Annual Tax on Enveloped Dwellings (ATED) charges will increase by 3.5%, in line with September 2026 CPI, for the 2027–28 charging period.  
 
Stamp Duty Land Tax (SDLT) will not apply to rent paid under assured tenancies in England, effective from 1 May 2026, following the introduction of the Renters’ Rights Act 2025. This will be introduced in Finance Bill 2026-27.  
 
A zero-rate of VAT for land sold to registered providers of social housing (relevant Housing Associations) will be implemented to take effect from 1 April 2027. 
 
A new First Time Buyer ISA will be introduced from April 2029. The product will replace the Lifetime ISA (LISA) for new savers and provide a 25% government bonus, paid on withdrawal, towards the purchase of a first home worth up to £450,000. The maximum value of the bonus will be capped at £20,000.  
 
Existing LISA holders will be able to continue contributing to and using their accounts under the current rules. In addition, the government will reduce the withdrawal charge for existing LISA holders who use their savings to purchase a first home above the £450,000 property price cap. 
 
From midnight on 29 October 2026 the withdrawal charge for purchases of properties above the LISA property price cap will be reduced to 20%. The charge for unauthorised withdrawals will remain at 25%. 
 
SDLT group relief rules will be amended to ensure that relief is withdrawn as intended when a purchaser leaves a corporate group, where the vendor company has been wound up. The changes will apply to transactions of property situated in England and Northern Ireland from 29 October 2026 and will be introduced through legislation in Finance Bill 2026-27.  

Business rates relief will be increased for pubs, social clubs and all but the very largest live music venues in England by 20ppt, from 15% to 35% from 1 April 2027. Live music venues with a rateable value of £1 million or above will not receive this increased rate of relief, but will continue to benefit from the previously announced 15% relief in 2026-27 and real-term freeze in 2027-28 and 2028-29, as announced in January 2026.  
 
Small Business Rates Relief eligibility thresholds will be increased for qualifying retail, hospitality and leisure (RHL) properties in England from 1 April 2027. The threshold for 100% relief will increase to a rateable value of £18,000, and the threshold for tapered relief will increase to a rateable value of £21,000.  
 
Business rates bill increases for qualifying RHL properties in England are to be capped by CPI inflation in 2027-28 and 2028-29. This does not apply to increases in rateable values resulting from improvements, or losses in other reliefs such as improvement relief or hardship relief post 1 April 2026.  
 
The 2026 Supporting Small Business (SSB) scheme will be extended for one year from 1 April 2027 for those who were in receipt of 2023 SSB in England.  
 
The 1p Transitional Relief Supplement (TRS) will be extended for two years from 1 April 2027. This will be paid each year by those seeing bill increases otherwise below the Transitional Relief and SSB caps.  
 
The £150 and £300 fees charged by the Valuation Tribunal in England for non-domestic rating appeals will be abolished. This will apply to the 2026 rating list and future lists and will enable fees already paid for appeals on the 2026 list to be refunded. 
 
From April 2027, Adult Gaming Centres in England will no longer be eligible for the RHL multipliers, and vape shops in England will no longer be eligible for the RHL multipliers and the Small Business Rates Relief.  
 
To combat avoidance, a General Anti-Abuse Rule (GAAR) for business rates will be introduced in England as soon as possible, following a consultation on design and delivery. From April 2027, the government will also reimburse local authorities for external legal costs incurred in unsuccessful cases that challenge business rates avoidance and test a point of law.

The Benefit in Kind rates on company cars for the 2030-31 tax year will be one percentage point above 2029-30 rates across all vehicle bands. Percentages for zero-emission vehicles will increase from 9% to 10%, rates for cars emitting 1-50g CO2/km will increase from 19% to 20%, and all other rates will increase by one percentage point, subject to a maximum of 40%.  
 
The Van Benefit Charge and the Car and Van Fuel Benefit Charges will be increased in line with CPI from 6 April 2027. 
 
As announced on 27 October, the tax-free mileage rates for employees and self-employed people who use their own car or van for work will be permanently increased. The tax-free, per mile rate will be 55p for the first 10,000 miles and 35p per mile for mileage above 10,000 miles.  
 
Since July, a reduced annual Vehicle Excise Duty (VED) rate of £1 has been available to the majority of HGVs. The reduced rate applies to VED licences or renewals taken out between 1 July 2026 and 30 June 2027. Changes will be made so that from 28 October 2026 where this reduced rate is obtained for more than 12 months, any excess benefit may be recoverable from the vehicle keeper as a civil debt.  
 
VED rates will be uprated for cars, vans and motorcycles in line with the Retail Prices Index (RPI) from 1 April 2027. 
 
At Budget 2025, the government announced that search and rescue charities will receive an exemption from VED for eligible vehicles. Legislation for the exemption will come into effect from 1 April 2027.  
 
Legislation will be introduced to clarify that electricity supplied through publicly accessible, and workplace electric vehicle charging points is subject to 20% VAT and is not considered domestic use for the Climate Change Levy. The legislation will take effect from 1 November 2026.  
 
Carbon Price Support rates will be ended from April 2028. 
 
The main rates of Climate Change Levy for electricity and liquified petroleum gas will be frozen from April 2028, at 2027-28 levels. The main rates for gas and solid fuels for 2028-29 will be uprated in line with RPI.  
 
The temporary 0% VAT rate for domestic electricity (six months from 1 October 2026) for qualifying supplies of electricity in the UK will be extended for a further three months, to 1 July 2027.  
 
The temporary 5p-per-litre fuel duty cut will be extended for a further six months to 1 July 2027. The government is also deferring the planned RPI inflation increase to 1 July 2027.  
 
The temporary 3.7p-per-litre red diesel duty cut will also be extended for a further six months, along with the proportional reduction in red diesel duty resulting from the 5p cut to the main fuel duty rate. Red diesel duty will then return to its pre-March 2022 rate and be uprated in line with RPI from 1 July 2027.  
 
Payments made under the DESNZ Electricity Bill Discount Scheme will be exempted from income tax, with retrospective effect from 6 April 2026. 
 
Heat batteries will be added to the list of materials that qualify for the reduced rate of VAT of 5% that applies to energy saving materials from 1 April 2027, when installed in residential accommodation and charitable buildings. This will be legislated for via secondary legislation and take effect from 1 April 2027.  
 
As previously announced, the government will extend the Electricity Generator Levy (EGL) past 2028. The EGL will remain for the lifetime of the longest Wholesale Contract for Difference (WCfD), on which DESNZ is launching a consultation. The exemptions for new investment and CfDs will remain, and CfDs will include WCfDs. A consultation on future EGL policy design will follow next year, and changes will be made in a future Finance Bill.  
 
Large private hire vehicle operators with annual fare turnover above a certain threshold will be liable for 20% VAT on the full value of their fares from 2 January 2028. The government will shortly publish a consultation to confirm the level of this threshold, with £50 million annual fare turnover as the lead option, and to support final policy design and implementation.  
 
The government has also announced a review of the VAT Tour Operators Margin Scheme and whether it is still fit for purpose or whether reform should be considered. A consultation has been launched with the consultation running from 28 October to 31 January 2027.  
 
Following consultation, from 1 April 2030 the government will introduce mandatory certification for mechanically recycled plastic used in plastic packaging for the purposes of Plastic Packaging Tax (PPT).  
 
The standard rate of Landfill Tax will be increased by RPI and the lower rate by the cash amount of the increase in the standard rate in England and Northern Ireland, preventing the difference between the rates getting wider.  
 
The cap of tax credit claimable by landfill operators in respect of contributions to the Land Communities Fund (LCF) will be increased from 5.3% to 8.3% of their Landfill Tax liability, to help sustain the LCF and support local communities.

As is typical, the Chancellor announced further measures to close the tax gap, which is estimated to raise £3.6 billion by 5 April 2032. These measures are wide-ranging. 
 
From 1 April 2029 VAT invoices will need to be issued in a specified electronic format. The government has published an implementation roadmap, which sets out the key elements of the e-invoicing regime, and by April 2028 will provide full details on the policy and technical design of e-invoicing. A consultation has also been published on potential future uses of structured invoice data generated through e-invoicing.  
 
The £2,500 Income Tax Self-Assessment expenses threshold will be reformed from 6 April 2028. This will allow more taxpayers to claim tax relief on non-reimbursed employment expenses through PAYE and ensure more claims are subject to evidence before relief is issued.  
 
Income Tax Self-Assessment taxpayers who make payments on account will be required to make more regular in-year payments towards their final tax bill from April 2029, resulting in accelerated income tax payments.  
 
Taxpayers will be required to set up a direct debit instruction for VAT and PAYE return liabilities from April 2029. Businesses will continue to be able to use other payment methods to pay their liability before a specified cut-off date. The direct debit instruction will be used to collect any unpaid balances.  
 
A new power will be introduced enabling HMRC to recover lower value tax debts through regular instalments directly from the bank accounts of individuals and companies who can afford to pay but repeatedly fail to do so from July 2029. The government propose to work with stakeholders to develop a Code of Practice setting out the safeguards and operational framework for the policy before being introduced to legislation in a future Finance Bill.  
 
Taxpayers joining Making Tax Digital (MTD) for income tax in April 2027 will not receive penalty points for late submission of their first four quarterly updates for the tax year 2027-28. The government is also deferring the roll-out of MTD for Income Tax to several taxpayer groups until further notice.  
 
As announced at Budget 2025, the government will clarify that image rights payments related to an employment are taxable as employment income and taxed in the same way as wages. To provide affected sectors with additional time to adjust to this change, the measure will now take effect from 6 April 2028.  
 
From October 2027, VAT Online Market Place Liability rules will be extended to UK businesses. Online marketplaces will be responsible for collecting VAT on sales by UK VAT-registered businesses and any other UK business with a minimum annual sales threshold per platform of £90,000. The rules will not apply to non-business (i.e. personal) sales, second-hand goods, or business-to business transactions. 
 
New rules will be introduced requiring taxpayers to correct tax returns and documents where inaccuracies are identified. These will be introduced through legislation in Finance Bill 2026-27 and take effect from 1 April 2028.  
 
HMRC’s plan to modernise its approach to ensuring the wealthy meet their tax obligations has been published.  
 
A targeted civil penalty will be introduced for deliberate conduct intended to evade UK excise duty before an excise duty point arises. The amendments will have effect from the date of Royal Assent to Finance Bill 2026-27.  
 
The government will shortly publish a consultation on a package of measures to tackle the promotion and use of tax avoidance.  
 
The government will review its approach to persistent non-compliance and egregious behaviour by a small minority of larger businesses, including through the Special Measures regime. The government will engage stakeholders on any potential changes.  
 
The framework for how HMRC publishes the details of deliberate tax cheats will be strengthened to bear down on those who default on their tax liabilities and will bring forward changes next year.  
The Promoters of Tax Avoidance Schemes legislation will be amended to ensure that the regime works more effectively and will make a typographical amendment to the legal professionals’ legislation in Finance Act 2026.  
 
A consultation will be published later this year on reform to the offshore penalties framework.  
Minor technical changes will be made to the rules that apply to gains made by non-resident close companies that are attributed to UK resident individuals, trusts and companies. The government is also clarifying the legislation around the tax treatment of termination payments. The changes will be introduced through legislation in Finance Bill 2026-27 and take effect from 28 October 2026.  
 
Following consultation on company payments to participators, the proposed new reporting requirements will not be implemented at this time.

Further measures will be introduced to simplify and modernise the tax and customs system at a Tax Update in 2027.  
 
A consultation is being published exploring opportunities for targeted simplifications to the Corporate Tax system that could improve certainty and support investment, growth and competitiveness. The government will work with stakeholders over the next year to develop and prioritise reforms.  
 
The government is publishing a Call for Evidence on the future administration of Corporation Tax, seeking views on how a modernised Corporation Tax administration system could better support companies to report and pay the right amount of tax first time.  
 
The minimum expenditure threshold for HMRC’s Advance Tax Certainty Service will be reduced from £1 billion to £300 million, expanding access to the service from 4 November 2026.  
 
The government is publishing a summary of responses to the call for evidence on predevelopment costs. Next steps set out include exploring potential changes to guidance to clarify the tax treatment of such costs; and considering wider challenges for some infrastructure investment under the capital allowances regime.  
 
Following consultations in 2023 and 2025, and the publication of draft legislation in July, the Securities Transfer Tax will be introduced and replace Stamp Duty and Stamp Duty Reserve Tax from late 2027.  
The rates used by employers to reimburse employees for domestic and overseas business travel and subsistence expenses without requiring receipts to be checked will be reformed and simplified from April 2028.  
 
Following a consultation earlier this year the tax treatment of distributions and related rules will be reformed to ensure they are consistent, regardless of legal form, company residence or transaction structure. Draft legislation will be issued for technical consultation in 2027, with the changes taking effect from April 2028. 
 
From April 2027, the reverse charge on cross-border supplies of services will be restricted to VAT-registered businesses. Where overseas providers make supplies of services to non-VAT registered UK businesses, they will be required to account for VAT in the normal way.  
The tax treatment of medical deputies will be restored to its previously intended position from 1 May 2027.  
 
A new zero-rate of VAT will be introduced for medicines donated in qualifying circumstances, including through early and expanded access schemes. The zero-rate applies to qualifying donations made on or after 23 June 2026.  
 
An exemption from the duty to deduct sums representing income tax from interest paid on Scottish Government bonds will be introduced, the issuance of which is subject to Treasury approval. The exemption will apply to any interest paid on or after 28 October 2026. 
 
The government has announced that they will be introducing new measures aimed and providing new powers and safeguards in respect of claims made through Form VAT126. Although further details are not yet available, it may be that the government is trying to align the treatment to reflect the same terms and conditions that apply to those entities that are VAT registered.  

Machine Games Duty (MGD) will be increased from 20% to 25% for machine games with stakes over £1 or prizes over £100 from 1 April 2027. The Government will also change the liability for MGD to machine suppliers for supplier-owned machines under profit sharing arrangements from 1 April 2028 and has launched a 12-week consultation on the implementation of this reform.  
 
Alcohol duty rates will be increased in line with RPI to maintain its real terms value. The relative value of Small Producer Relief will also be increased compared to the main rates, by moving to a more generous discount taper for products under 3.5% ABV and uprating the marginal discount for products between 3.5% and 8.4% ABV by RPI plus an additional 10%. These changes will be implemented from 1 February 2027.  
 
The Gross Gaming Yield bandings for gaming duty will be frozen from 1 April 2027 until 31 March 2028.  
 
The Soft Drinks Industry will be uprated on 1 April 2027. The Levy will be increased in line with Consumer Price Index plus one fifth of the ‘catch up’ increment to reflect the 27% CPI increase between 2018 and 2024.  
 
All rates of Air Passenger Duty 2028-29 will be increased in line with RPI from 1 April 2028.