Autumn Budget 2026: The Impact on your Finances

Chancellor John Healey has delivered his first Budget, and the first under Prime Minister Andy Burnham. Billed as a Budget to give households and businesses "breathing space", it leans heavily on energy bill support, while raising money from property and savings income rather than from wages.

As always, how it affects you will depend on your own circumstances. Whether you own a home, rent out property, run a business, have a family or are approaching retirement, here's what was announced and what it could mean for your personal finances.

Homeowners and first-time buyers

For existing homeowners, there was very little in the way of direct mortgage news. Stamp duty was left untouched, as the Prime Minister had already ruled out changes ahead of the Budget. With the average new mortgage rate sitting at 5.88% on Budget morning, what happens to rates next is likely to depend more on how the markets react to the Budget and on the Bank of England than on anything the Chancellor said today.

The High Value Council Tax Surcharge, often called the "mansion tax", is still due from April 2028 for homes in England worth £2 million or more. Despite rumours that the threshold could be lowered, no change was announced.

The biggest boost for homeowners comes through energy bills. Around 20 million households in council tax bands A to D will receive a £100 Household Energy Payment this winter, paid directly into their bank accounts. The VAT cut on household electricity has been extended until July, which the Chancellor says takes around £50 off the annual price cap. Gas standing charges will also be removed from household bills from next year, with the cost moved into unit rates instead. The government estimates 60% of households will save around £45 a year, although those who use more gas could end up paying more.

For first-time buyers, the new Your First Home scheme will launch in spring 2027. Backed by £4.7 billion, it offers an equity loan of up to 20% on new-build homes, meaning buyers could get on the ladder with a deposit as small as 2.5%. The loan comes with a five-year interest-free period, and the government expects it to help around 70,000 first-time buyers. It's worth remembering that an equity loan is still borrowing, so it's important to understand what you'll repay once the interest-free period ends.

The Chancellor also announced that the Lifetime ISA will be replaced by a new First Time Buyer ISA from April 2029. Savers will still be able to pay in up to £4,000 a year and receive a 25% government bonus, for homes worth up to £450,000. In the meantime, the penalty for withdrawing money from a Lifetime ISA for a non-qualifying reason falls from 25% to 20% from 29 October 2026, so savers will get back at least what they paid in.

Landlords

Landlords are among the hardest hit by this Budget. Last year's Budget had already set property income tax rates at 22%, 42% and 47% from April 2027. The Chancellor has now added a further two percentage points on top, taking the basic, higher and additional rates on property income to 24%, 44% and 49% from 6 April 2027.

The change applies to individual landlords in England, Wales and Northern Ireland. Landlords who hold their properties through a limited company pay corporation tax instead, so they won't be affected by this particular rise. As a simple example, a higher-rate taxpayer with £20,000 of rental profit would pay £8,800 in tax from April 2027, compared with £8,000 today, an extra £800 a year before any other costs are taken into account.

The Office for Budget Responsibility has warned that the measure risks pushing some landlords out of the market, which could put further upward pressure on rents. The 5% stamp duty surcharge on additional properties also stays in place. If you're a landlord, now is a good time to review your portfolio, stress-test your cash flow against your borrowing costs and speak to an adviser before making any big decisions.

Savers, business owners and working-age people

The National Living Wage and National Minimum Wage will both rise by 3.9%, benefiting around 2.3 million workers. That takes the National Living Wage from £12.71 to around £13.20 an hour, or roughly £27,500 a year for a 40-hour week, while the National Minimum Wage rises from £10.85 to around £11.27.

The Chancellor stressed that there would be no increase in tax on wages or dividends. However, income tax and National Insurance thresholds remain frozen until 2031 following last year's Budget, so fiscal drag continues. As your pay rises, more of your income could be pulled into a higher tax band.

There was welcome news for savers. The planned £12,000 cap on cash ISA contributions for under 65s, due from April 2027, has been scrapped, so the full £20,000 annual ISA allowance stays in place. The government will also consult on a new Starter ISA to reward first-time investors. Outside of an ISA, though, tax on savings income will rise by a further two percentage points from April 2027, making ISAs an even more valuable way to protect your savings from tax.

Lee Trett, Director of Money Helpdesk, said "Dropping the planned cut to the Cash ISA allowance is the right call. Pushing cautious
savers towards the stock market was never going to work by shrinking their options...But let's not pretend the problem is solved...Keeping your money tucked inside an ISA wrapper is now an essential tool for protection."

For business owners, the Small Business Rate Relief threshold for retail, hospitality and leisure businesses will rise from £12,000 to £18,000, taking around 70,000 more businesses out of paying business rates altogether. On the other hand, the threshold for Business Asset Disposal Relief, which reduces capital gains tax when you sell your business, has been cut from £1 million to £500,000.

Families and carers

For many families, the £100 Household Energy Payment and the extended VAT cut on electricity will be the most noticeable changes this winter. The government has also suspended tariffs on more than 100 supermarket products, which could help ease the cost of the weekly shop.

Unpaid carers will benefit from the removal of the Carer's Allowance "cliff edge". Until now, earning even a pound over the £204 weekly limit meant losing the allowance entirely. Instead, it will now taper down by £1 for every £1 earned above the limit, so carers can take on extra hours without losing all of their support.

Self-employed fathers and partners will also be eligible for paid parental leave for the first time. A wider welfare reform white paper is expected before the end of the year, so there may be further changes to benefits to come in 2027.

Over 65s

Under the triple lock, the state pension is set to rise by 3.9% from April 2027, taking the full new state pension to £13,036.40 a year, an increase of around £489.

Because that would push the full state pension above the £12,570 personal allowance, the Chancellor confirmed that pensioners whose only income is the state pension won't pay income tax on it for the rest of this Parliament. However, if you also receive a private pension or workplace pension, you'll still pay income tax on income above the usual threshold.

Older savers will also be pleased that the cash ISA changes have been reversed, and that the energy support package should help keep heating costs down this winter. Looking further ahead, the government has said it plans to change the triple lock from 2030 if Labour wins the next election, so it's worth keeping an eye on how that could affect your retirement income.

Need advice on how the Budget affects you?

If you'd like to talk through what the 2026 Autumn Budget means for your mortgage, your savings or your plans for the year ahead, our advisers are here to help. Get in touch to speak to an expert.