What tax changes were announced in the Budget? Ollie Turner shares his initial reaction

The Chancellor’s Autumn Budget has delivered a relatively measured set of tax changes, rather than a major overhaul of the tax landscape. While there are fewer headline announcements than some might have expected, several changes will be important for business owners, investors and individuals planning their finances.

Here are the key tax measures I think are worth highlighting.

Business owners and entrepreneurs

• Business Asset Disposal Relief (BADR): The lifetime limit will fall to £500,000 for qualifying disposals made on or after 6 April 2027. This is an important consideration for anyone planning to sell or exit their business.
• Founders’ Relief: A new relief is proposed from April 2027, potentially offering a 10% Capital Gains Tax rate on up to £10 million of lifetime gains. However, strict qualifying conditions are expected, including requirements around R&D investment, turnover and business growth. The details remain subject to consultation, and the relief is unlikely to be relevant to many businesses.
• Business mileage: The tax-free mileage rate for business travel over 10,000 miles will increase from 25p to 35p per mile from April 2027.
• Trading allowance: The tax-free trading allowance for self-employed individuals will increase from £1,000 to £3,000 from April 2027.
• Capital allowances: The main writing-down allowance will reduce to 12% from April 2027, while the main first-year allowance will increase to 50% from January 2027.
• R&D tax relief: The claims process is set to be simplified, including removing the requirement to submit a claim notification form and streamlining the additional information form.
• Enterprise Management Incentives (EMI): Companies will no longer need to submit a separate notification in the year EMI options are granted from April 2027. These grants will instead be reported through the annual EMI40 return.

Personal tax, savings and pensions

• Cash ISAs: The annual Cash ISA allowance will remain at £20,000.
• Property and savings income: Income Tax rates on property and savings income will increase by two percentage points from April 2027, taking the rates to 24%, 44% and 49% across the respective tax bands.
• State Pension and Income Tax: A new pension tax allowance is planned from April 2027 to prevent Income Tax being charged on State Pension income where it exceeds the applicable Personal Allowance. The precise application will depend on the final rules.

Business tax and administration

• Foreign branch profits: The foreign branch exemption election will become mandatory for relevant companies for accounting periods beginning on or after January 2027.
• Share transfers: Stamp Duty on shares is expected to be replaced by a new Securities Transfer Tax in late 2027. No change to the tax rate or removal of existing beneficial reliefs is currently expected.
• Self -assessment payments: Payments on account are due to be reformed from April 2029, requiring taxpayers to make payments more regularly.
• VAT and PAYE: Direct Debit payments will become mandatory for VAT and PAYE from April 2029.
• Making Tax Digital (MTD): Penalties will be waived in full for the 2027-28 tax year for taxpayers required to join MTD from April 2027.

My overall view

Although this Budget contains relatively few headline tax changes, the detail matters.

For business owners, the changes to business disposal relief, capital allowances and R&D claims could influence future decisions. For individuals, the planned increases to tax on property and savings income are worth factoring into longer-term financial planning.

As always, the impact will depend on individual circumstances, and it is worth reviewing any planned transactions or financial decisions in light of the changes.

At Verallo, we’ll be looking at what these announcements mean in practice and helping clients understand where action may be needed.

Our guide to the Budget will be available this week

Our full Autumn Budget guide, covering the key announcements and what they could mean for you, will be available on Friday.

In the meantime, if you have any questions about how today’s announcements could affect you or your business, get in touch with our team.