What the 2026 Autumn Statement means for your business

On Wednesday 28 October, Chancellor John Healey gave a speech to the House of Commons, unveiling the 2026 Autumn Statement.

The Chancellor of the Exchequer is the government's chief financial minister, and the Autumn Statement is their opportunity to set out plans for the UK economy.

An overview of the 2026 Autumn Statement

This is Chancellor Healey’s first autumn budget, after replacing Rachel Reeves in July 2026, and it’s been hotly anticipated as it’s the first under new Prime Minister Andy Burnham. Some spending plans had already been trailed in the days before the statement, amid rising energy and food costs.

On the same day as the budget, the Office for Budget Responsibility (OBR) publishes its economic and fiscal outlook. As the independent public finances forecaster, this is an independent assessment of the expected impact of the policies announced in the statement.

The OBR makes an independent announcement as a checks and balances exercise, holding the Chancellor of the Exchequer and Treasury accountable on behalf of the public. It forecasts on assumptions, including what’s in the budget and what it thinks will happen to oil and gas prices, as to whether the UK's economy will grow or shrink.

The OBR’s predictions may not come to pass, but they give us a useful picture of what could be ahead. Following this Budget, the OBR expects the UK economy to grow by around 1.25% in 2026, slightly higher than forecast in March.

However, growth is expected to slow to 1% in 2027, down from the 1.5% predicted in March, before recovering. Across the forecast period, annual growth is expected to average around 1.5%, broadly unchanged from March’s Spring Budget forecast.

Inflation — the rate at which the price of goods and services goes up, and ultimately how far your money stretches — is expected to reach 3.6% by the end of 2026. However, independent forecasters predict it'll fall to 2.5% by the end of 2027, bringing it closer to the government's 2% target.

There's also some positive news for business investment. It's forecast to grow by 2.7% in 2026, beating the 1.9% growth predicted by the Office for Budget Responsibility (OBR) in March. Looking ahead, business investment is expected to grow by a further 1.9% in 2027.

So, how will the budget affect small businesses, the self-employed and landlords? Read on to find out:

Skip ahead:

More business rates relief for shops, hospitality and leisure businesses

Business rates increases capped for two years

National Minimum Wage and National Living Wage increases

Extra business rates relief for pubs and music venues

Higher tax-free trading allowance

Changes to VAT for online marketplace sellers

Fuel duty cuts extended

Higher tax-free mileage allowances

Changes to tax relief when selling a business

Higher income tax on rental income

More forgiving Making Tax Digital penalties

Reduced VAT on heat batteries

Parental pay extended to self-employed parents

More business rates relief for shops, hospitality and leisure businesses

From 1 April 2027, more retail, hospitality and leisure businesses in England will qualify for business rates relief. Eligible properties with a rateable value of up to £18,000 could pay no business rates, with reduced bills for some properties valued up to £21,000.

Impacted: Small shops, cafés, restaurants, pubs, hotels and other eligible retail, hospitality and leisure businesses in England.

These changes apply to England only. Scotland, Wales and Northern Ireland will receive additional funding and can choose whether to introduce similar support for businesses.

Business rates increases capped for two years

Business rates increases for qualifying retail, hospitality and leisure properties in England will be capped at inflation for 2027/28 and 2028/29. This should make it easier for affected businesses to plan their costs, although some exceptions apply.

Impacted: Retail, hospitality and leisure businesses in England that pay business rates.

National Minimum Wage and National Living Wage increases

From 1 April 2027, the National Living Wage will rise by 3.9% to £13.21 an hour. The minimum wage for 18 to 20-year-olds will increase to £11.27 an hour.

For employees, this will bring the rates to:

2025 wage per hour	Category	Increase (£)	Increase (%)	2026 wage per hour
£12.71	Employees aged 21 and over	£0.50	0.39%	£13.21
£10.85	Employees aged 18-20	£0.42	0.39%	£11.27
£8.00	Employees aged under 18	£0.31	0.39%	£8.31
£8.00	Apprentices	£0.31	0.39%	£8.31

Impacted: Employers paying staff at or near the minimum wage.

Extra business rates relief for pubs and music venues

Pubs and music venues in England will get additional business rates support from April 2027, with relief increasing from 15% to 35%. The increased relief won't apply to the largest music venues with a rateable value of £1 million or more.

Impacted: Eligible pubs and music venues in England.

Higher tax-free trading allowance

From 6 April 2027, the trading allowance will increase from £1,000 to £3,000. This means people earning smaller amounts from self-employment or other qualifying trading activities will be able to earn more before their trading income exceeds the allowance.

Impacted: Self-employed people, freelancers and people earning extra money from qualifying side businesses.

Changes to VAT for online marketplace sellers

From October 2027, online marketplaces will become responsible for collecting VAT on sales made through their platforms by UK businesses with sales above the £90,000 threshold. The change won't apply to personal sales.

Impacted: VAT-registered businesses selling through online marketplaces.

Fuel duty cuts extended

The temporary 5p-per-litre cut in fuel duty will stay in place until 1 July 2027. The planned increase in fuel duty in line with inflation has also been delayed.

Impacted: Businesses that rely on vehicles.

Higher tax-free mileage allowances

Businesses will pay employees up to 55p per mile for the first 10,000 business miles travelled in their own car or van, and 35p per mile after that, without the payments being taxed.

Impacted: Employers who reimburse staff for business travel in their own vehicles and self-employed people who use their own vehicles for business journeys.

Changes to tax relief when selling a business

From 6 April 2027, the lifetime limit for Business Asset Disposal Relief will fall from £1 million to £500,000. This means business owners who qualify for the relief may pay more tax when selling all or part of their business.

Impacted: Business owners planning to sell a qualifying business or business assets.

Higher income tax on rental income

From April 2027, income tax rates on property income will rise by a further two percentage points. The new rates will be 24% for basic-rate taxpayers, 44% for higher-rate taxpayers and 49% for additional-rate taxpayers.

Impacted: Landlords who pay income tax on rental profits in England, Wales and Northern Ireland.

More forgiving Making Tax Digital penalties

Self-employed people joining Making Tax Digital for Income Tax in April 2027 won't receive penalty points if they submit any of their first four quarterly updates late during the 2027/28 tax year.

The government is also delaying the rollout for some groups of taxpayers, although the Budget doesn't confirm which groups are affected.

Impacted: Self-employed people and sole traders joining Making Tax Digital for Income Tax in April 2027.

Reduced VAT on heat batteries

From April 2027, qualifying installations of heat batteries in residential properties will benefit from a reduced VAT rate of 5%. This could make installing this type of energy-saving technology less expensive.

Impacted: Residential landlords considering heat batteries for their properties.

Parental pay extended to self-employed parents

From April 2029, eligible self-employed fathers, partners and adopters in Great Britain will be able to access parental pay. This extends support to people who are currently excluded from the system.

Impacted: Eligible self-employed fathers, partners and adoptive parents in England, Scotland and Wales.

Source: Gov.uk