How will the Autumn Budget affect your business?

Income tax. Extending the freeze on income tax thresholds from 2028/29 to 2030/31 will raise an expected £7.6billion pounds in 2029/30. As salaries increase to keep pace with an estimated 3.5% average inflation rate, more employees will pay higher tax rates. 

 

Fuel duty. Fuel duty rates remain frozen at the current rate until the end of August 2026. The planned inflation increase for 2026/27 will not go ahead. However, after this extension, fuel duty will gradually increase back to 2022 levels. 

 

Property. dividends and savings income. Taxes on income from property, dividends and savings will increase by 2%. The rate of dividend tax from April 2026 will increase to 10.75% for the basic rate of tax and to 35.75% for the higher rate tax. This will apply above a lower rate threshold, not yet confirmed. It will affect how landlords and company directors go about tax planning. 

 

Pensions. From April 2029, employee and employer National Insurance Contributions (NICs) will apply to salary sacrifice pension payments above £2,000 annually. Previously exempt, this has been a tax efficient way for employers to support employees to build up pension pots. The pension triple lock remains throughout this parliament for pensioners on the full new state pension. 

 

Capital Gains Tax. Tax relief if you’re selling your business to an Employee Ownership Trust will go down from 100% to 50%. The government says this move will continue to support employee ownership schemes. However, business owners will pay significantly more tax. 

 

Electric vehicle charges. Drivers of electric and plug-in hybrid vehicles will pay a new mileage-based charge from April 2028. Electric vehicles will pay 3p per mile and plug-in hybrid cars will pay 1.5p per mile. This move is in addition to the changes to electric vehicle (EV) road tax last year. It will help plug the gap in revenue raised from fuel duty as more people drive electric vehicles (EVs). If you’re considering EVs for your business, you may want to review the long-term impact of this additional charge. 

 

Business incentives. The budget included confirmation of permanently lower tax rates for around 750,000 retail and hospitality properties. Wider eligibility for enterprise incentives will support smaller, high-risk companies. There are also plans for tax relief for investors in early-stage startups and for companies that choose to list in the UK. 

 

High value homes. If one of your business objectives is to create the home of your dreams, you’ll be disappointed to hear about this new tax. Properties valued at over £2million by the Valuation Office (2026 prices) will pay a new annual tax from April 2028. It will have four tiers from £2,500 to £7,500 affecting homes valued between £2million and £5million or more. The Chancellor said collection will take place alongside Council Tax, affecting fewer than the top 1% of properties. The move could raise £0.4billion in 2029/30. 

 

Child benefits. From April 2026 low-income families with more than two children will receive additional benefit payments. This measure will probably cost about £3billion in 2029/30.