Category: Tax Compliance

In short: the Autumn Budget on 28 October 2026 left the headline income tax, National Insurance, VAT and corporation tax rates alone, but it changed several things that matter to owner-managed companies, landlords, sole traders and anyone moving to or leaving the UK. From 6 April 2027 the tax rates on savings and property income rise by four points to 24%, 44% and 49%; the Business Asset Disposal Relief lifetime limit halves to £500,000; the trading allowance triples to £3,000; the approved mileage rate above 10,000 miles rises to 35p; and a new High Value Council Tax Surcharge of £2,500 to £7,500 a year starts in April 2028 for homes worth £2 million or more. Every figure below was read on GOV.UK on 2 November 2026 and the source is named next to it.

The Budget 2026 changes at a glance

The table lists each measure, the figure, the date it takes effect and the GOV.UK document it comes from. The Finance Bill can still amend the detail before it becomes law.

Measure	What changes	From	Source
Savings income tax rates	Basic, higher and additional rates rise to 24%, 44% and 49% (from 20%, 40% and 45%)	6 April 2027	OOTLAR, Income Tax: Savings Income Tax Rates for tax year 2027-2028
Property income tax rates	Basic, higher and additional rates of 24%, 44% and 49% on rental profits in England, Wales and Northern Ireland	6 April 2027	OOTLAR, Income Tax: Property rates for tax year 2027-28
Trading allowance	Rises from £1,000 to £3,000; the Self Assessment reporting threshold for trading income also becomes £3,000	6 April 2027	Increasing the trading allowance (28 October 2026)
Business Asset Disposal Relief	Lifetime limit falls from £1,000,000 to £500,000; qualifying gains remain taxed at 18%; relief already claimed counts towards the new limit	Disposals on or after 6 April 2027	New Business Asset Disposal Relief lifetime limit (29 October 2026)
New relief for founders	A lower Capital Gains Tax rate on qualifying disposals of shares; technical consultation closes 30 November 2026	Disposals on or after 6 April 2027	OOTLAR, Capital Gains Tax: Introduction of a new relief for founders
Approved mileage rates	Rate above 10,000 business miles rises from 25p to 35p per mile; the first 10,000 miles stay at 55p	6 April 2027	OOTLAR, Approved Mileage Allowance Payments and Self-Employed Simplified Mileage Rates
High Value Council Tax Surcharge	Annual charge on homes in England valued at £2 million or more: £2,500 (£2m to £2.5m), £3,500 (£2.5m to £3.5m), £5,000 (£3.5m to £5m), £7,500 (£5m and above); paid by the owner, not the occupier; valuations as at April 2026	April 2028 (first bills March 2028)	High Value Council Tax Surcharge (updated 28 October 2026)
Corporation tax	Main rate stays at 25% and small profits rate at 19% for the financial year beginning 1 April 2028	1 April 2028	OOTLAR, Financial Year 2028 Charge and Rate of Corporation Tax
Capital allowances	Main-rate first-year allowance rises to 50% for expenditure from 1 January 2027; main-rate writing-down allowance falls to 12% from 1 April 2027	1 January 2027 and 1 April 2027	OOTLAR, Capital Allowances
R&D tax relief	Claim Notification Form no longer required for claims made on or after 1 April 2027; Additional Information Form simplified from autumn 2027	1 April 2027	OOTLAR, R&D Tax Reliefs: Improving the Customer Experience
VAT on domestic electricity	Temporary 0% rate extended to 30 June 2027 (it would otherwise have returned to 5% on 1 April 2027)	Until 30 June 2027	OOTLAR, Extending the Temporary 0% VAT rate for Domestic Electricity
Making Tax Digital for Income Tax	No late-submission penalty points for 2027-28 quarterly updates for those joining in April 2027; exemptions for qualifying carers, non-UK resident entertainers and sportspeople and expected non-resident customers continue until further notice	April 2027	OOTLAR 2.36 and 2.37
Self Assessment payments on account	More regular in-year payments for taxpayers who make payments on account; eligible taxpayers can pay through PAYE	April 2029	OOTLAR 2.31, More Timely Payments for Self Assessment
Company distributions	Distributions framework (capital reductions, buybacks, demergers) modernised; draft legislation in 2027	April 2028	OOTLAR 2.15, Modernising the Distributions Framework
Securities Transfer Tax	Replaces Stamp Duty and Stamp Duty Reserve Tax on shares	Late 2027, by commencement order	OOTLAR 1.64, Modernisation of the Stamp Taxes on Shares Framework
Lifetime ISA	Withdrawal charge for a home above the £450,000 cap falls from 25% to 20%; a First Time Buyer ISA with a 25% bonus on up to £20,000 replaces the Lifetime ISA for new savers from April 2029; the cash ISA limit stays at £20,000	29 October 2026 / April 2029	OOTLAR 2.3 to 2.5
Banking surcharge	Rises to 6%	1 January 2027 to 31 March 2028	OOTLAR 1.37
Investors in US LLCs	New double taxation relief for UK resident individuals who hold US LLC interests; claims from early 2028	Early 2028	OOTLAR 2.46, Investors in US LLCs and Reverse Hybrids

What the Budget means for owner-managed companies

Three measures touch almost every small company we act for. The first is the halving of the Business Asset Disposal Relief lifetime limit to £500,000 for disposals on or after 6 April 2027. If you are planning to sell your company or to close it through a members’ voluntary liquidation and take the proceeds as capital, the timing of the disposal now matters: a sale that completes before 6 April 2027 is tested against the £1,000,000 limit, and a sale on or after that date against £500,000, with any relief you have already used counted against it. GOV.UK also sets out an anti-forestalling rule for contracts signed before 6 April 2027 but completed after it, so a contract signed to beat the deadline needs a commercial reason that can be evidenced. The second measure is the rise in the first-year allowance to 50% for main-rate plant and machinery bought from 1 January 2027, which brings forward relief for companies investing in equipment, while the writing-down allowance on the remaining pool falls to 12% from 1 April 2027. The third is the removal of the R&D claim notification form for claims on or after 1 April 2027, which takes away a trap that has cost late-notifying companies their whole claim.

The corporation tax rates themselves do not move: 25% main rate and 19% small profits rate are confirmed for the year beginning 1 April 2028. The planned reform of the distributions framework from April 2028 will change how capital reductions, share buybacks and demergers are taxed; draft legislation is promised in 2027 and we will cover it when it is published.

Landlords and savers: four points more tax from April 2027

The largest single change for individuals is the four-point rise in the rates on savings and property income. From 6 April 2027 a basic-rate taxpayer pays 24% on rental profits and interest, a higher-rate taxpayer 44% and an additional-rate taxpayer 49%, against 20%, 40% and 45% in 2026-27. Dividend rates are not changed by this Budget. Non-resident landlords under the Non-Resident Landlord Scheme are taxed at the property income rates on their UK rental profits, so the rise applies to them too. For a landlord with £20,000 of taxable rental profit in the higher-rate band, the extra tax from April 2027 is £800 a year; the personal allowance and the £50,270 higher-rate threshold remain frozen.

Owners of homes in England worth £2 million or more should also diary April 2028, when the High Value Council Tax Surcharge starts. The charge is banded, from £2,500 a year for a home valued between £2 million and £2.5 million to £7,500 a year for a home worth £5 million or more, and it falls on the owner rather than the occupier. Values are assessed as at April 2026. GOV.UK does not yet say how properties owned through companies or by non-residents are treated, so we will update this guide when the legislation is published.

Sole traders and side incomes

The trading allowance rises from £1,000 to £3,000 on 6 April 2027, and the threshold at which trading income must be reported through Self Assessment rises to the same figure. In practice someone with a small side income of up to £3,000 a year from 2027-28 will neither pay tax on it nor have to file a return for it, unless they have another reason to file. The approved mileage rate above 10,000 business miles rises from 25p to 35p per mile from the same date, with the first 10,000 miles staying at 55p; the same figures apply to the simplified mileage rates used by the self-employed. Taxpayers joining Making Tax Digital for Income Tax in April 2027 (income over £30,000) will not receive late-submission penalty points for the 2027-28 quarterly updates, and from April 2029 payments on account move to more regular in-year payments.

Moving to the UK or leaving it

There was no change to the UK tax residence rules, the four-year foreign income and gains regime or the temporary repatriation facility in this Budget. Two measures are still worth noting. For anyone selling a UK company or business before emigrating, the Business Asset Disposal Relief change above makes the date of disposal relative to 6 April 2027 a planning point in its own right; our guide to closing or selling a UK company when you leave the UK covers the full sequence. For UK residents who hold interests in US limited liability companies, a new double taxation relief will let them claim credit for US tax paid on the LLC’s earnings against UK tax on the distributions, with claims possible from early 2028. If you are arriving in the UK with overseas income, our page on moving to the UK: immigration and tax explains the first-year position, and our UK accountant for non-residents page covers the continuing obligations of someone who keeps UK income after leaving.

What did not change

• Income tax rates on earnings and the main National Insurance rates: unchanged; the personal allowance and thresholds remain frozen.
• Dividend tax rates: no new change in this Budget.
• VAT rate and VAT registration threshold: unchanged.
• Corporation tax: 25% and 19% confirmed for the year from 1 April 2028.
• Main Capital Gains Tax rates: unchanged.

Frequently asked questions

When do the new savings and property income tax rates start?

On 6 April 2027, for the 2027-28 tax year. The rates are 24%, 44% and 49%. Source: GOV.UK, Budget 2026 Overview of tax legislation and rates, published 28 October 2026.

Has Business Asset Disposal Relief been abolished?

No. The relief continues at an 18% rate, but the lifetime limit falls from £1,000,000 to £500,000 for qualifying disposals made on or after 6 April 2027. Relief claimed in the past counts towards the new limit. Source: GOV.UK policy paper of 29 October 2026.

Does the BADR change affect a members’ voluntary liquidation?

Yes, where the distributions are capital and qualify for the relief. The date of the distribution determines which limit applies, so a company closure planned for 2027 should be timed with the 6 April 2027 date in mind. Our company closure page explains the strike-off and MVL routes.

What is the new trading allowance?

£3,000 a year from 6 April 2027, up from £1,000. Trading income up to £3,000 does not need to be reported through Self Assessment from 2027-28, unless you have another reason to file. Source: GOV.UK, Increasing the trading allowance, 28 October 2026.

What are the approved mileage rates from April 2027?

55p per mile for the first 10,000 business miles and 35p per mile above that, from 6 April 2027. The 25p rate for miles above 10,000 applies until then. Source: GOV.UK OOTLAR, 28 October 2026.

What is the mansion tax and when does it start?

Its formal name is the High Value Council Tax Surcharge. It applies to residential properties in England valued at £2 million or more as at April 2026, from April 2028, with first bills in March 2028. The annual charge is £2,500, £3,500, £5,000 or £7,500 depending on the band, and the owner pays it. Source: GOV.UK, High Value Council Tax Surcharge, updated 28 October 2026.

Did the corporation tax rate change?

No. The main rate stays at 25% and the small profits rate at 19%, now confirmed for the financial year beginning 1 April 2028.

Did the Budget change the rules for people moving to the UK or leaving it?

No change was announced to the Statutory Residence Test, the four-year foreign income and gains regime or the temporary repatriation facility. The BADR lifetime limit and the new US LLC relief are the two measures most likely to affect internationally mobile clients.

Is VAT on electricity still 0%?

Yes for domestic electricity: the temporary 0% rate is extended to 30 June 2027. Source: GOV.UK OOTLAR 2.20.

When does the Securities Transfer Tax start?

In late 2027, by commencement order, replacing Stamp Duty and Stamp Duty Reserve Tax on shares. Source: GOV.UK OOTLAR 1.64.

Figures read on GOV.UK on 2 November 2026 from the Budget 2026 Overview of tax legislation and rates (published 28 October 2026), the Business Asset Disposal Relief policy paper (29 October 2026), the trading allowance policy paper (28 October 2026) and the High Value Council Tax Surcharge page (updated 28 October 2026). Measures can change before the Finance Bill is enacted. This article is general information, not advice on your own position.

In short: identity verification has been a legal requirement for every new director and person with significant control (PSC) of a UK company since 18 November 2025. Existing directors and PSCs have a 12-month transition period that ends in November 2026: each existing director must provide a Companies House personal code with the company’s next confirmation statement, and each PSC within their own 14-day window. Overseas directors are not exempt and can verify from any country through an Authorised Corporate Service Provider (ACSP) such as TaxDigit.

Who has to verify

Companies House guidance lists the roles that must verify now: directors (and their equivalents, such as LLP members and general partners), directors of overseas companies registered in the UK, people with significant control, and anyone applying to be an ACSP. Verification for people who merely file at Companies House, and for corporate directors, limited partnerships and officers of corporate PSCs, is being introduced later, with at least six months’ notice.

The dates that matter

• 18 November 2025: verification became mandatory for new directors and PSCs, and the 12-month transition period for existing ones began.
• Existing directors: provide your personal code in the company’s next confirmation statement. A confirmation statement is due at least every 12 months, so every existing director’s due date falls inside the transition period.
• Overseas companies with a UK establishment: confirm that all directors have verified by the anniversary of the UK establishment’s registration.
• PSCs: 14 days starting the day after the confirmation statement date if you are also a director of that company; otherwise the first 14 days of your birth month. If you became a PSC after 18 November 2025, within 14 days of being added to the register.
• New companies: every director’s personal code is required as part of the incorporation filing.

Two ways to verify, one of them from any country

You can verify directly with Companies House through GOV.UK One Login, using the app, security questions or photo ID details followed by a visit to a participating Post Office. Or you can ask an ACSP to verify you. Companies House says of the ACSP route: “You can do this from any country.” The agent must be registered with a UK anti-money laundering supervisory body and must meet the same level of assurance as Companies House itself.

TaxDigit is a registered ACSP (AP019483) and carries out the check in-house through its own verification platform, so an overseas director does not need a UK address, a UK phone number or a Post Office visit. Once you have verified, you receive your personal code and we request it from Companies House for use in the company’s filings.

What happens if you miss it

Companies House states that failing to comply on time may be an offence, punishable by a financial penalty or prosecution, and that continuing to act as a director without complying is a further offence for the director, the company and its other directors. In practice the first thing that breaks is the confirmation statement: it cannot be filed until every director is verified, and a missed confirmation statement carries a fine of up to £5,000 and the risk of strike-off. Companies House has also said that an unverified person will in future be unable to be appointed as a director, register a new company or register as an ACSP, and that a note will be published against their name on the register.

What overseas owners of UK companies should do this month

1. Check your company’s confirmation statement date on the Companies House register.
2. List every director and PSC, including those living abroad, and confirm who has already verified.
3. Have anyone still unverified complete the check now, through GOV.UK One Login or through an ACSP, rather than in the week the confirmation statement is due.
4. Keep each personal code securely and give it only to the person preparing your filings.

Two other UK dates fall in the same window: HMRC must receive paper Self Assessment returns for 2025/26 by 11:59pm on 31 October 2026 (online returns by 31 January 2027), and the Chancellor has confirmed the Budget for Wednesday 28 October 2026.

Frequently Asked Questions

Do I have to verify my identity with Companies House if I live outside the UK?

Yes. The requirement applies to every director and PSC of a UK company and to the directors of overseas companies with a UK establishment, wherever they live. You can verify through GOV.UK One Login, or through an Authorised Corporate Service Provider (ACSP) from any country.

When is the deadline for existing directors?

Existing directors must provide their Companies House personal code as part of the company’s next confirmation statement. Because every company must file a confirmation statement at least every 12 months, every existing director’s due date falls within the 12-month transition period that began on 18 November 2025. Check your company’s confirmation statement date on the Companies House register and verify before it.

When is the deadline for PSCs?

A PSC who is also a director of the same company provides the code within 14 days starting the day after the company’s confirmation statement date. A PSC who is not a director provides it within the first 14 days of their birth month. Someone who became a PSC after 18 November 2025 provides it when added to the register or within 14 days of being added.

What is a Companies House personal code?

It is the unique identifier you receive once your identity has been verified. It belongs to you, not to any company, and you need it for confirmation statements, director appointments and PSC filings. You only verify once, and you should share the code only with people you trust, such as your accountant.

What happens if a director does not verify in time?

Failing to comply on time may be an offence leading to a financial penalty or prosecution, and continuing to act as a director after the deadline without complying is itself an offence. The company cannot file its confirmation statement until all of its directors are verified, which in turn risks a fine and strike-off. Companies House has also said a note will be published against the person’s name on the public register.

Can TaxDigit verify my identity remotely?

Yes. TaxDigit is a registered Authorised Corporate Service Provider (AP019483) and carries out Companies House identity checks in-house for UK and overseas directors and PSCs, remotely, in English. We then request the personal code from Companies House and handle the confirmation statement filing where we act for the company.

How TaxDigit can help

We verify directors and PSCs as a Companies House authorised agent, provide a UK registered office and act as the company’s agent with Companies House and HMRC, so an overseas-owned UK company stays compliant without anyone being resident in the UK. See our company formation and ID verification service, the guide to setting up a UK company from abroad, and our page for UK accountants for non-residents. Sources: Companies House guidance “Verifying your identity for Companies House” and “When you need to verify your identity for Companies House” (updated 30 July 2026), and the GOV.UK changes to UK company law campaign page.

Stamp duty on shares is finally going digital — on 13 July 2026 HMRC published draft legislation for a new Securities Transfer Tax (STT), a single, self-assessed, fully digital tax that will replace both stamp duty and stamp duty reserve tax (SDRT) on transfers of securities, targeted for introduction in 2027. As chartered certified accountants in Surrey advising companies and shareholders across the UK, TaxDigit explains what the new regime means for share sales, company purchases and group reorganisations, and what to do before the rules change.

What Is the Securities Transfer Tax — and Why It Matters

Today, tax on share transfers is split between two regimes: stamp duty, a document-based charge dating back to 1891 that still requires stock transfer forms to be sent to HMRC for stamping, and SDRT, which applies to paperless transactions settled electronically through CREST. Running two parallel systems for what is economically the same transaction creates duplication, delay and confusion — a company registrar cannot lawfully write up the register of members until a stamped instrument comes back from HMRC, which can hold up completions for weeks.

The Securities Transfer Tax sweeps both regimes away. Under HMRC’s policy paper Modernisation of the Stamp Taxes on Shares framework — Securities Transfer Tax, published with draft legislation on 13 July 2026, a single self-assessed tax will apply to transfers of securities, reported and paid through a new online portal. There will be no more physical stamping and no more paper-based reporting or payment.

What Changes From 2027

The government is aiming to introduce the STT and its legislative framework in 2027, with an update on the exact commencement date due in autumn 2026. The key features of the new regime are:

• One tax, one portal — a single self-assessed charge replaces stamp duty and SDRT, reported and paid digitally; CREST will continue to handle transactions settled electronically.
• The purchaser is liable — but an agent (such as your accountant or solicitor) can act as the “accountable person” and deal with reporting and payment.
• Faster completions — a unique taxpayer reference number (UTRN) is generated immediately on submission of the return, and the registrar can write up the register of members as soon as the UTRN is received, rather than waiting for HMRC to stamp a document.
• Clear payment deadlines — 30 days for off-market transfers, 14 days for transactions in electronic settlement systems, running from the earlier of substantial performance or completion.
• Reliefs retained and self-assessed — stamp duty group relief, reconstruction and acquisition reliefs, the growth-market exemption and intermediary relief all carry over, claimed through the portal without waiting for HMRC adjudication.

The Transitional Rule

The draft legislation provides a four-year transitional period for transactions entered into before the commencement date of the new rules. In practice this means agreements signed under the old regime — conditional share purchase agreements, options and deferred completions among them — will need to be tracked carefully across the boundary, because the tax treatment of a deal signed in 2026 but completed after commencement will depend on the transitional provisions. Anyone negotiating a share sale or reorganisation now should consider how the change of regime affects timing.

Who Benefits — and Who Should Still Pay Attention

Buyers of private companies gain the most: no more sending stock transfer forms for stamping, no more weeks-long delays before the share register can be updated, and a clear digital process with an immediate UTRN. Groups undertaking reorganisations keep group relief and reconstruction relief, but these become self-assessed — the burden of getting the analysis right shifts squarely onto the taxpayer and their adviser, with a full compliance regime behind it. Trustees, partnerships and investors holding unlisted shares should also note that transfers of partnership interests are expected to move out of scope entirely under the new framework.

What Companies and Shareholders Should Do Now

• Review any share purchase agreements, options or conditional deals that may straddle the 2027 commencement date and map them against the four-year transitional rules.
• Factor the new 30-day and 14-day payment windows into completion timetables and funds-flow planning.
• Check whether group reorganisations planned for 2027 onwards would be better accelerated or deferred once the commencement date is confirmed in autumn 2026.
• Decide who will act as the accountable person for future transfers — the portal allows your accountant to take on the reporting and payment obligation.
• Respond to the technical consultation, which closes on 7 September 2026, if the draft rules create issues for your transactions.

Frequently Asked Questions

What is the Securities Transfer Tax?

The Securities Transfer Tax (STT) is a proposed single, self-assessed, fully digital UK tax on transfers of securities. It will replace both stamp duty and stamp duty reserve tax, with reporting and payment handled through a new HMRC online portal.

When does the STT start?

The government is targeting introduction in 2027, with an update on the commencement date expected in autumn 2026. Draft legislation was published on 13 July 2026 and is open for technical consultation until 7 September 2026.

Will stamp duty group relief still exist?

Yes. Group relief, reconstruction and acquisition reliefs, the growth-market exemption and intermediary relief are all retained under the new regime, but they will be self-assessed through the portal rather than adjudicated by HMRC in advance.

Do I still need to send documents to HMRC for stamping?

Under the current rules, yes — stock transfer forms for off-market share purchases must still be submitted to HMRC with stamp duty paid within 30 days. Once the STT commences, physical stamping disappears entirely and everything is done digitally.

How TaxDigit Can Help

TaxDigit advises on the tax consequences of company share sales and purchases, group reorganisations and shareholder exits, alongside tax advisory and planning and year-end accounts support. We can review deals that straddle the 2027 changeover, act as your accountable person under the new regime, and structure transactions to preserve group and reconstruction reliefs. The full policy paper and draft legislation are on gov.uk.

Plan Ahead With TaxDigit

If you are buying or selling a company, restructuring a group or holding a deal that may complete after 2027, speak to us before the rules change. Call 01483 230 777, email info@taxdigit.co.uk or book a consultation with our team in Guildford, Surrey.