Quick answer: The Autumn Budget 2026 will take place on 28 October 2026, delivered by Chancellor John Healey. Several key measures have already been confirmed ahead of Budget day – including a VAT cut on electricity bills and a 20% business rates reduction for pubs and live music venues. While others, like pension inheritance tax changes, are already legislated and coming into effect from 2027.
With a new Prime Minister in Andy Burnham and a new Chancellor in John Healey, this year’s Autumn Budget lands at a pivotal moment for UK small businesses. Energy costs are rising, high streets are under pressure, and questions about tax are swirling.
And with our recent SME Insights Report 2026 revealing that 36% of business owners believe that the UK economy will probably worsen in 2026, all eyes are on the Budget.
Some tax relief has already been confirmed. But there’s still plenty the Budget could clarify, extend, or change. Here’s what we know so far:
When is the Autumn Budget 2026?
The Autumn Budget takes place on Wednesday 28 October 2026. Chancellor John Healey will deliver a statement to Parliament covering the government’s plans for tax and public spending.
Healey has said the Budget will “move money and power out of Westminster, and into every postcode around Britain” – and that it’ll give businesses and families “some of the stability they need to plan for the future.”
Will income tax, VAT, or National Insurance go up?
No increase to the rates of income tax, VAT, or National Insurance is expected.
Prime Minister Andy Burnham has committed to honouring Labour’s 2024 manifesto pledges, which included a promise not to raise these three taxes for the rest of this Parliament. Combined, they account for nearly 60% of total tax receipts – so keeping them frozen significantly limits the government’s options for raising revenue.
That said, Burnham has acknowledged the country is in a “challenging position” and hasn’t ruled out other forms of tax rises. Capital gains tax (CGT) is one area to watch. The rates last changed in October 2024, rising to 18% to 24% depending on your band.
What it means: For now, there’s no confirmed changes to income tax, VAT, or National Insurance are expected on 28 October.
VAT removed from domestic electricity bills – what it means for small businesses
One significant measure has already been confirmed and will take effect before Budget day. From 1 October 2026, VAT on household electricity bills drops from 5% to 0%.
Our SME Insights Report revealed that 35% of business owners rank high running costs (such as energy bills) as one of their biggest challenges.
So while this cut is primarily aimed at households – saving the average home around £45 a year, according to the government – there’s a benefit for some smaller businesses too.
Small businesses, charities, and residential care homes that already qualify for the reduced 5% VAT rate on electricity – through the existing VAT certificate and declaration process – will also benefit from the new 0% rate.
The VAT cut has been funded for the 2026-27 financial year. The government has said it will “keep looking” at what more it can do on energy bills, so it’s possible the October Budget could extend or build on this measure.
What it means: If your business pays a non-domestic energy tariff at the standard rate, you won’t automatically benefit. It’s worth checking with your energy supplier to understand what applies to you.
Business rates cut for pubs, clubs, and live music venues
On 23 July 2026, the government confirmed a 20% cut to business rates for pubs, social clubs, and live music venues in England, taking effect from April 2027.
This is on top of the 15% relief already in place for 2026/27 – announced back in January 2026. According to the government, the new cut will benefit nearly 32,000 businesses, saving the typical pub an estimated £1,100 in its first year.
The package is worth around £100 million a year and will be fully funded, partly through reviewing reliefs for businesses that don’t make a positive contribution to local communities – such as vape shops.
What it means: Cuts are coming but there are some important caveats. For example, the 20% discount won’t apply to the very largest live music venues. The government hasn’t yet said exactly where that line falls – but it’s promised to set out the details in the Budget.
Unused pensions and inheritance tax: what’s changing and when
This one’s already legislated – but many people still aren’t aware of it.
From 6 April 2027, most unused pension funds and pension death benefits will be included within a person’s estate for inheritance tax (IHT) purposes.
Currently, unused pension savings in discretionary pension schemes can be passed on to beneficiaries after death without any IHT charge. That’s been increasingly used as a tax-planning tool – and the government wants to put a stop to it.
Under the new rules, personal representatives (the people responsible for managing a deceased person’s estate) will be liable for reporting and paying any IHT due on unused pension funds.
The government estimates around 10,500 estates will have an IHT liability where they previously wouldn’t have, with a further 38,500 estates paying more IHT than before. The average IHT liability is expected to rise by around £34,000 when pension assets are included.
What it means: While this change was confirmed under the previous government, the Budget on 28 October could potentially revise how it’s implemented – particularly given the new Prime Minister’s reported willingness to look again at some inheritance tax reliefs. This one is worth watching closely.
What should small business owners do now?
The October Budget will bring more clarity – but there’s no need to wait until then to start thinking about your position.
Here’s what’s worth doing in the run-up to 28 October:
- Check your electricity tariff – if you’re on a qualifying reduced-rate tariff, confirm with your supplier that the VAT cut to 0% is being applied from 1 October.
- If you run a pub, club, or live music venue – look out for further Budget detail on the 20% business rates cut, including the threshold for large venues and any potential wider review of Small Business Rates Relief.
- If you have a pension you’re not drawing down – it’s worth speaking to a financial adviser about how the 2027 IHT changes could affect your estate planning. The rules are now confirmed in legislation.
- Watch the Budget on 28 October – and check back here for a full breakdown of what it means for your business.
More guides for small business owners
- Key types of business tax in the UK (2026-27 update)
- Quarterly tax reporting: practical ways to stay ahead of the new deadlines
- Mandatory e-invoicing starts in 2029: what you need to do first
- The hidden cost of running a small business (and tips to deal with it)
Ready to set up your cover?
As one of the UK’s biggest business insurance providers, we specialise in public liability insurance and protect more trades than anybody else. Why not take a look now and build a quick, tailored quote?