Autumn Budget 2026: what might change and what it would mean for you

The date: Wednesday 28 October 2026 Confirmed

The Autumn Budget will be delivered on Wednesday 28 October 2026. Chancellor John Healey confirmed the date in late July 2026 (HuffPost UK, GB News). It is a Budget of firsts: Healey’s first as Chancellor after replacing Rachel Reeves in July 2026, and the first fiscal event of Andy Burnham’s premiership. Announcing it, Healey promised plans “built on fiscal discipline” that meet the government’s existing fiscal rules.

As with every Budget, the Office for Budget Responsibility publishes a full economic and fiscal forecast alongside it — that forecast, not the speeches, is what determines how much room Healey actually has. For how the last fiscal event set the rules you are living under now, see our Autumn Budget 2025 summary; for the running list of measures already confirmed for this tax year, the UK Budget changes tracker.

How to read this page: the status labels

Pre-Budget coverage blurs the line between law, briefing and guesswork. We don’t. Every theme on this page carries one of four labels, and every claim names its source:

• Confirmed — announced government policy or legislation (enacted or in draft), with an official source. Not Budget speculation: this happens unless the government actively reverses it.
• Expected — strongly signalled by ministers or the near-consensus of serious analysts (IFS, NIESR, the big accountancy firms). Not yet law; could still change.
• Rumour — credible reporting or analyst speculation with no government confirmation. History says most Budget rumours do not happen. We say who is circulating it and why.
• Ruled out — explicitly ruled out by the government, or floated and formally dropped. A political pledge, not a law of physics — but breaking one carries a heavy price.

Nothing on this page is our invention. Where we add our own reading, we say so in plain terms, and every worked “what it would mean for you” number is labelled as illustrative arithmetic.

The fiscal backdrop: why this Budget is boxed in

Three numbers frame everything below.

• Headroom of £9.9 billion. At the March 2026 spring forecast, the OBR left the Chancellor £9.9bn of headroom against the fiscal mandate — a margin the OBR itself noted could be wiped out by a modest rise in borrowing costs (House of Commons Library, 2026 spring forecast summary).
• Borrowing running £2.7 billion above forecast. Public sector borrowing was £57.6bn in April–June 2026, £2.7bn above the OBR’s profile, driven by spending rather than weak receipts (ONS, Public sector finances: June 2026).
• New spending pledges to pay for. The Burnham government’s early cost-of-living package — VAT off household electricity from 1 October (around £850m for six months) and the restored £2 bus fare cap from 1 January 2027 — comes on top of pressure to fund defence spending of 3% of GDP by 2030, with a reported £4.7bn shortfall in the Defence Investment Plan (Euronews, ITV News, HuffPost UK). The Times has tallied roughly £1.8bn of Burnham spending commitments so far.

NIESR warned at the spring forecast that inflation is eroding the real value of planned public-service spending, leaving a substantial shortfall to fill (NIESR). Squeezed headroom plus new pledges, with the big three rate rises pledged away, is why serious previews (for example Alexander & Co’s Budget 2026 preview) expect any revenue-raising to come from thresholds, duties, reliefs and property- or wealth-adjacent measures rather than headline rates. That is the lens for every theme below.

Already law: the 2027 baseline the Budget builds on Confirmed

A surprising amount of what will be reported as “Budget news” is already legislated or in draft law. Whatever happens on 28 October, this is the confirmed baseline:

• Cash ISA cap from 6 April 2027. Cash ISA subscriptions capped at £12,000 a year for under-65s (65-and-overs keep £20,000); a 22% charge on interest on cash parked inside Stocks & Shares or Innovative Finance ISAs; no investment-ISA-to-Cash-ISA transfers for under-65s. Draft regulations published 13 July 2026 (GOV.UK). Full detail in our ISA guide’s April 2027 section.
• Savings and property income rates rise 2 points from April 2027 — to 22% basic, 42% higher, 47% additional. Legislated at Budget 2025 (Cowgills summary); see the savings interest tax calculator for today’s rules.
• Unused pension pots enter inheritance tax from 6 April 2027 — announced at Budget 2024 and unchanged since. Our 2027 pensions-into-IHT guide covers who is affected.
• Making Tax Digital for Income Tax expands from April 2027 — the threshold drops from £50,000 to £30,000 of gross self-employment/property income, then £20,000 from April 2028 (GOV.UK guidance). See our MTD ITSA guide.
• Income tax thresholds frozen to April 2031 — the freeze was extended three further years at Budget 2025.
• Fuel duty: 3p a litre rise on 1 January 2027, then RPI uprating from April 2027, under the amended plan published in May 2026 (GOV.UK).
• The “mansion tax” (High Value Council Tax Surcharge) from April 2028 on homes worth over £2m, at £2,500–£7,500 a year (Commons Library briefing).
• Salary-sacrifice pension cap from April 2029 — only the first £2,000 a year of sacrificed contributions keeps its NI exemption, as legislated at Budget 2025.

The Budget can build on, tweak or (in principle) reverse any of these — but reversal would need an announcement and, in most cases, fresh legislation. Treat this list as what happens by default.

Income tax and thresholds

Rises in income tax, VAT or employee NI rates Ruled out

Healey has confirmed the government will honour Labour’s 2024 manifesto pledge not to raise the rates of income tax, VAT or employee National Insurance (HuffPost UK). One honest caveat: Budget 2025 showed how a government can raise income tax rates on specific income types — dividends, savings, property — while keeping the pledge on the main rates. That route stays open.

The threshold freeze rolls on — fiscal drag is the tax rise nobody announces Confirmed

The personal allowance (£12,570) and higher-rate threshold (£50,270) are frozen to April 2031 under legislation already in force. The Resolution Foundation puts the freeze’s revenue at roughly £25bn a year (Resolution Foundation), and Saffery estimates the extension could pull around three million more people into the 40% band by 2028/29 (Saffery).

What it would mean for you (illustrative arithmetic): crossing £50,270 takes your marginal rate from 28% (20% tax + 8% NI) to 42% (40% tax + 2% NI). So each £1,000 of pay that inflation drags above the frozen threshold costs about £140 a year more than if the threshold had risen with it. Put your own salary through the Tax Drag Calculator, and see the cumulative effect on the fiscal drag tracker.

A higher personal allowance? Rumour

GB News reports that Burnham has said he is “looking at” the income tax personal allowance, calling it one of the issues constituents raise most (GB News). Treat this as aspiration until it is costed: every £100 added to the personal allowance is worth £20 a year to a basic-rate taxpayer — and costs the Exchequer billions across 30-plus million taxpayers, which sits awkwardly with £9.9bn of headroom. No serious analyst currently pencils this in.

Reversing the dividend and savings rate rises? Rumour

Investment platforms, led by AJ Bell, are pressing Healey to unwind parts of the Reeves package — the dividend rates that rose to 10.75% (basic) and 35.75% (higher) this April, and the 2-point savings and property rises due April 2027 (AOL/Telegraph reporting). Pressure is not policy: with the fiscal arithmetic above, our plain reading Expected is that the legislated rates stand — wholesale reversal looks hard to fund. Model your position either way with the dividend tax calculator.

ISAs and savings

The £12,000 Cash ISA cap from April 2027 Confirmed

This is the one big “Budget 2026” story that is not speculation. Draft legislation published on L-day, 13 July 2026, caps Cash ISA subscriptions at £12,000 for under-65s from 6 April 2027, keeps the full £20,000 for the 65-and-overs, levies a 22% charge on interest on cash parked inside investment ISAs, and blocks investment-ISA-to-Cash-ISA transfers for under-65s (draft ISA (Amendment) Regulations 2026; anti-circumvention factsheet; MoneySavingExpert). The technical consultation closed on 2 August 2026, and final regulations are due to be laid before Parliament this autumn — which makes the Budget window the natural moment for any final adjustments.

What it would mean for you (illustrative arithmetic): an under-65 saver who would have put £20,000 into cash must redirect £8,000. In an ordinary savings account at an illustrative 4.5%, that £8,000 earns £360 a year of interest — tax-free if it fits inside your Personal Savings Allowance, but costing £72 (basic rate) or £144 (higher rate) a year in tax if your PSA is already used up. Full planning detail: what changes in April 2027 in our ISA guide, and the savings interest tax calculator.

Could the Budget soften the ISA package? Rumour

Industry response to the draft rules has been critical — MoneySavingExpert reports providers arguing the added complexity risks putting off the first-time investors the policy is meant to create, and AJ Bell has urged Healey to end the rolling uncertainty around ISAs and pensions (MSE; Yorkshire Live). There is no government signal of a rethink. Our plain reading Expected: the final regulations are laid this autumn broadly as drafted, with technical tweaks from the consultation — not retreat.

Pensions

Cutting pension tax-free cash or tax relief Rumour — and a perennial one

Honesty first: a raid on the 25% tax-free lump sum or higher-rate relief is rumoured before every Budget, and it has not happened at any recent one. Ahead of Budget 2025, reports said tax-free cash cuts were explicitly off the table (Hargreaves Lansdown). This cycle, AJ Bell is urging Healey to kill the speculation early because it does real damage — savers pull tax-free cash prematurely and can’t undo it (GB News). If you are tempted to act pre-emptively, read pension tax traps first: crystallising early is irreversible and usually costs more than the rumour ever would.

The 2029 salary-sacrifice cap — kept, softened or scrapped? Confirmed Reversal: rumour

From April 2029, only the first £2,000 a year of salary-sacrificed pension contributions keeps its NI exemption — legislated at Budget 2025. AJ Bell and others want Healey to scrap it, warning the biggest impact falls on employees earning £45,000–£50,000 (AOL/Telegraph reporting). What it would mean for you (illustrative arithmetic, current rates): sacrifice £6,000 a year and the £4,000 above the cap would attract employee NI at 8% — about £320 a year — plus employer NI at 15% (£600) that employers may pass on. Model your own set-up with the salary sacrifice calculator.

Pensions into inheritance tax from April 2027 Confirmed

Unused pension pots enter the IHT net from 6 April 2027 — a Budget 2024 measure that survived Budget 2025 untouched. Nothing credible suggests this Budget reopens it. Who it catches, and the estate-planning consequences, are in our 2027 pensions-into-IHT reform guide.

Property and capital gains

The £2m+ “mansion tax” stays on track for April 2028 Confirmed

The High Value Council Tax Surcharge, announced at Budget 2025, applies to English homes valued over £2m from April 2028: £2,500 a year (£2m–£2.5m) rising in bands to £7,500 (over £5m), based on April 2026 valuations, raising an estimated £430m a year (Commons Library; MoneyWeek). No credible reporting suggests the Budget changes it — but band details and valuation mechanics are exactly the kind of thing a first Budget can refine.

CGT rates or reliefs Rumour

Capital gains tax is on most analysts’ lists of “commonly discussed” candidates for this Budget (Alexander & Co), partly because it sits outside the manifesto pledge. What is already real: Business Asset Disposal Relief’s rate rose from 14% to 18% on 6 April 2026 (CMS). What a rate rise would mean (illustrative arithmetic): one recurring proposal is aligning CGT with income tax rates. A higher-rate taxpayer with a £20,000 taxable gain pays £4,800 at today’s 24%; at 40% it would be £8,000 — £3,200 more. Current rules, rates and planning: our capital gains tax guide 2026/27.

Lifetime gift caps and main-residence CGT Rumour — dormant

Both were heavily trailed before Budget 2025 and did not materialise (Macfarlanes). We have found no fresh, credible reporting that either is back on the table for this Budget. If that changes, it will appear in the update log with a source.

For landlords: the non-Budget backdrop Confirmed

Two already-confirmed tracks shape landlord maths regardless of the Budget: property income tax rates rise 2 points from April 2027 (above), and the Renters’ Rights Act continues to phase in — Section 21 evictions ended and tenancies became periodic from 1 May 2026, with the PRS database rolling out from late 2026 (NRLA).

Family and benefits

High Income Child Benefit Charge No credible rumours either way

We are tracking it because fiscal drag makes it bite harder every year the thresholds stand still — but as of early August 2026 we have found no credible reporting of planned HICBC changes at this Budget. If your income sits near the taper, check where you stand with our HICBC threshold and taper guide and the HICBC calculator — a pension contribution that lowers adjusted net income is the classic pre-Budget-proof move.

The cost-of-living package is already announced — the Budget has to pay for it Confirmed

Two family-budget measures arrive outside the Budget: VAT on household electricity drops from 5% to 0% from 1 October 2026 for six months, worth roughly £45 against the annual price cap and costing around £850m (Euronews), and single bus fares in England outside London are capped at £2 from 1 January 2027 (ITV News). Watch Budget day for whether the electricity VAT cut is extended past March 2027 — and for the funding line that pays for all of it.

Motoring and duties

Fuel duty: a 3p rise is pencilled in for 1 January 2027 Confirmed

The current legal position, amended in May 2026: the duty freeze runs to the end of 2026, a 3p-a-litre rise lands on 1 January 2027, and RPI uprating resumes from April 2027 (GOV.UK; Full Fact).

What it would mean for you (illustrative arithmetic): 3p of duty attracts VAT on top, so about 3.6p a litre at the pump — roughly £1.98 more per 55-litre tank, or around £49 a year for a driver covering 12,000 miles at 40mpg.

Will the Budget cancel it, again? Rumour

Every pencilled-in fuel duty rise since 2011 has been cancelled or deferred at a fiscal event — the OBR documents the pattern (OBR, fuel duties), and preview coverage flags fuel duty as squarely in play depending on conditions (Alexander & Co). But a “cost of living government” that also needs the revenue faces a genuine dilemma: cancelling the January rise would cost the Exchequer roughly what the electricity VAT cut already does. We label cancellation a rumour, not an expectation — history leans one way, this year’s arithmetic leans the other.

How to prepare either way: moves that work whatever Healey announces

None of these depend on guessing the Budget right. They use rules that already exist, before any of them can be changed:

• Use the 2026/27 ISA year deliberately. The £20,000 allowance is untouched this year, and for under-65 cash-heavy savers this is the last full year of unrestricted Cash ISA subscriptions before the confirmed £12,000 cap. Start with the complete ISA guide.
• Bank the CGT annual exempt amount. The £3,000 allowance dies with the tax year, and a rumoured rate rise is a reason to realise planned gains sooner rather than later — not a reason to panic-sell. Rules and rates: the CGT guide 2026/27.
• Fill pension headroom on today’s rules. Annual allowance plus carry-forward works now, at your current marginal relief rate; check yours with the annual allowance calculator. Do not crystallise tax-free cash because of a rumour — see pension tax traps for why that so often goes wrong.
• Know your drag exposure. Frozen thresholds are confirmed to 2031 — run your salary through the Tax Drag Calculator so a pay rise doesn’t surprise you at 42%.
• If HICBC or the 60% trap is near, act on adjusted net income — pension contributions and Gift Aid are Budget-proof levers. Start at the HICBC threshold guide.
• Do the seasonal sweep. Our Autumn 2026 money checklist covers the non-Budget housekeeping worth finishing before the news cycle takes over.

What we’ll update on Budget day (28 October 2026)

This page becomes our live hub as the speech lands and the documents drop. Concretely, on the day and in the days after we will:

• Re-label every theme above — each Rumour resolves to Confirmed or Ruled out, with the Red Book or OBR document as the source.
• Add a “what was actually announced” section at the top, separating measures that hit 2026/27 immediately from those starting April 2027 or later.
• Re-run every worked example against announced figures, and update the affected calculators and guides — changes are logged in the update log below with dates.
• Update the companion pages: the Budget changes tracker, what changed this tax year, and — once it exists as history — a Budget 2026 summary to sit alongside our Budget 2025 summary.

Bookmark this page; the URL will not change.

Update log

• 2 August 2026 — Page launched. Budget date (28 October) confirmed sourcing added; fiscal backdrop from the March 2026 OBR forecast and June 2026 ONS borrowing data; first status pass on all themes. The ISA technical consultation closes today — we will link the government response when published.

Dated entries are added here every time a status changes, so you can see exactly what moved and when. Spot something we have missed? Email corrections.

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