Autumn Budget 2026 – All the Important Announcements for Contractors

In today’s Budget, Chancellor John Healey began his speech by calling his first Budget one for the “working people of Britain, for British businesses big and small”. Key announcements from his speech included:

For Businesses

• Business rates relief expanded for retail, hospitality and leisure businesses, with the threshold increasing from £12,000 to £18,000.
• Around 70,000 businesses are expected to be removed from paying business rates altogether.
• Local retention of business rates will be expanded, with a share of revenues going directly to metro mayors.
• Tariffs will be suspended on more than 100 imported products, helping to reduce costs for businesses and consumers.
• The higher mileage rate will increase from 25p to 35p per mile, with changes also being made to support those claiming business mileage relief.
• A new Founders’ Relief will introduce a 10% tax rate on lifetime gains up to £10 million for qualifying business founders.
• The tax-free trading allowance will increase from £1,000 to £3,000 for people starting a new venture.
• New support measures have been announced for young entrepreneurs and female-led businesses.

For Employees and Households

• A £100 Household Energy Payment will be made this winter to households in Council Tax Bands A-D.
• Gas standing charges will be abolished from 2027 (or as soon as possible), with electricity reforms expected to follow.
• The VAT cut on electricity bills will be extended through to July 2027.
• The National Minimum Wage and National Living Wage will increase by 3.9%, benefiting an estimated 2.3 million workers.
• The 5p fuel duty cut has been extended until July 2027.
• Parental pay eligibility will be extended to more parents, including many self-employed fathers.
• The Carer’s Allowance earnings cliff edge will be replaced with a taper system.
• From April 2027, a new Pension Tax Allowance will protect pensioners whose total income does not exceed the full new State Pension from paying Income Tax, with tapered support for those earning more.

For Savers and Homebuyers

• The Cash ISA allowance will remain at £20,000 per year.

• Savings and property income: From 6 April 2027, income tax rates on savings and property income will increase by a further two percentage points across all tax bands, on top of the increases previously announced in the 2025 Budget.

• A new Starter ISA is planned to help make saving and investing more accessible.
• The Lifetime ISA will be replaced by a new First Time Buyer ISA.
• Reforms to the current Lifetime ISA penalty system have been promised.
• A new Your First Home Scheme will launch next spring, backed by £4.7 billion of government-supported equity loans for first-time buyers.

Tax Changes

• The lifetime limit for Business Asset Disposal Relief will be reduced from £1 million to £500,000, although the Government states that around three-quarters of current claimants will be unaffected.

We will be posting our full Budget report tomorrow morning, which will outline the confirmed upcoming tax changes in greater detail. The report will be posted firstly on our LinkedIn company page, so follow us to find out when it’s been published.