What can business owners expect from the upcoming Autumn Budget?

Business leaders await the upcoming Autumn Budget on 28 October with some trepidation. This is Chancellor John Healey’s first Budget and his priority will be to protect the economy, rather than propel it forward.

Healey needs to find an estimated £35bn to avoid cuts to public spending and fund recent pledges – namely to continue to fund the health service and spend 3% of the national budget on defence by 2030.

UK employers are still adjusting to some of the changes made by his predecessor, including sharp increases to labour taxes. Business confidence remains subdued despite a rebound in the third quarter, according to the Institute of Chartered Accountants in England and Wales. 

Corporation tax set to remain unchanged 

There will be targeted giveaways to restore flagging sectors but, as always, there will be losers. The banking sector appears to be one of the Chancellor’s targets. But when taxes on bank profits rise, there can be knock-on effects. JPMorganChase’s CEO Jamie Dimon has already warned he’ll reconsider building his new £3bn London HQ if banks are targeted. 

Both the British Chambers of Commerce and the Federation of Small Businesses have been pressing the government to ease the tax burden and avoid any steep increases to the National Minimum Wage. The government has said it will retain the current 25% corporation tax rate and full-expensing tax relief, as well as the Annual Investment Allowance.

Prime Minister Andy Burnham has also pledged to retain the current headline rates for National Insurance, income tax and VAT as part of the “working people” promise in the 2024 Labour manifesto. However, this leaves the Chancellor with very little room to manoeuvre.

What are the possible CGT changes? 

Capital gains tax (CGT) remains a potential candidate for boosting the public finances. There are many levers that Healey could pull. While he has already rejected calls from his Labour colleagues to equalise income tax and CGT rates, he may restrict existing reliefs or revisit the CGT uplift that occurs upon death. 

Currently, the uplift means beneficiaries inherit assets at their market value at the date of death rather than the deceased’s original acquisition cost, effectively wiping out the CGT liability.

The April 2026 changes to inheritance tax on business assets remain in the spotlight. Business owners considering their succession plans will scrutinise the speech for any additional changes in this area to see how it might affect their estate planning.

Rather than introducing sweeping tax reforms, it seems more likely that Healey will introduce a raft of smaller taxes targeting specific industries and capital-rich individuals and organisations. A recent consultation lays out one potential route. The government wants to prevent business owners and shareholders from using certain business structures to pay a lower rate of tax when taking money out of companies, particularly via share sales, company restructurings or repayments of capital rather than ordinary dividends.

How will the government seek to lift business confidence? 

The government has already announced a 20% business rates discount for eligible pubs, clubs and live music venues from April 2027. Wider business rates reform is also under consideration, although there are no guarantees and any help will probably be sector-specific. There is also likely to be new support for energy-intensive industries and devolution may be on the agenda, with more support promised to the regions.

The Enterprise Investment Scheme (EIS), which helps business owners secure growth capital, saw its scope doubled last year. Companies can now raise £10m through EIS, up from £5m, in any given year. Larger companies also now qualify for the scheme, but there is speculation that further reforms could be announced in the Autumn Budget. 

The Treasury recently asked entrepreneurs to make recommendations for how the government could help them grow in its Tax Support for Entrepreneurs call for evidence. This could result in the removal of the EIS cliff edge in favour of a taper.

This is a Budget with very few leaks. Healey will want to improve business confidence. If the Budget establishes fiscal credibility without materially increasing the burden on employers and investors, pent-up corporate investment and transactions could gain momentum.

Keep up to date with our Budget coverage

On 28 October, our experts will be providing instant reaction to the key Budget measures on our dedicated hub and our LinkedIn page. And in the following weeks, we’ll have in-depth analysis and advice on how the Chancellor’s measures will affect your business.