Chancellor John Healey delivered the first Autumn Budget of Prime Minister Andy Burnham’s government on 28 October 2026. The headline U-turn was on savings: the planned cut to the Cash ISA allowance has been scrapped, so the limit stays at £20,000 for every adult. This guide explains the changes that matter to households, savers and first-time buyers in plain English, with start dates wherever our sources give one.
This is general information, not personal financial advice, and we are not licensed financial advisers. Tax rules and benefits depend on your circumstances, so check GOV.UK or speak to a regulated adviser before acting.
Autumn Budget 2026 at a glance
| Area | What changed | When |
|---|---|---|
| Cash ISA | £20,000 limit stays for all adults; the planned £12,000 cap for under-65s is scrapped | Confirmed 28 October 2026 |
| Stocks and shares ISA | Planned 22% tax on uninvested cash cancelled | Announced |
| Lifetime ISA | Penalty for first homes above £450,000 falls from 25% to 20% | From 29 October 2026 |
| Savings and property income | Tax rates rise by 4 percentage points in total | From April 2027 |
| Electricity VAT | 0% VAT extended until July 2027 | Zero-rated since 1 October 2026 |
| Council tax bands A to D | £100 one-off payment | From January 2027 |
| Income tax thresholds | Frozen until 2031 | Announced |
| Minimum wage | Up 3.9%; National Living Wage £13.21 | April 2027 |
| Trading allowance | Tripled from £1,000 to £3,000 | 6 April 2027 |
| Fuel duty | Frozen, so the 5p cut stays | Until July 2027 |
Which? describes some items, such as the Your First Home scheme, as proposed rather than final, so treat those as plans until the rules are published.
Savers and ISAs: what changed
The biggest change for savers is what did not happen. At the previous Budget, then-Chancellor Rachel Reeves announced that savers under 65 would be limited to £12,000 a year in a Cash ISA from April 2027. Healey scrapped that plan, according to Money to the Masses, Vanguard and Which?, so the full £20,000 allowance remains available for cash. The overall ISA limit stays at £20,000 a year across all ISAs.
- Stocks and shares ISAs: the planned 22% tax on uninvested cash inside these ISAs has been cancelled, Which? reports, so cash held in them stays tax-free.
- Lifetime ISA: from 29 October 2026 the penalty for using the money on a first home above the £450,000 price cap falls from 25% to 20%. The 25% charge on unauthorised withdrawals stays.
- First Time Buyer ISA: from April 2029 it replaces the Lifetime ISA for new savers. You can pay in up to £4,000 a year and receive a 25% government bonus, which is up to £1,000 a year, on homes worth up to £450,000.
- New investor incentive: the government says it is exploring an incentive for first-time stocks and shares ISA investors, with no details yet.
Tax on savings and property income is going up
Against the ISA good news sits a tax rise. Which? reports that rates on savings and property income above the personal allowances rise by four percentage points in total, and Vanguard puts the start at 6 April 2027.
| Taxpayer band | Rate before | Rate after |
|---|---|---|
| Basic rate | 20% | 24% |
| Higher rate | 40% | 44% |
| Additional rate | 45% | 49% |
That is why ISA allowances matter more now: interest inside an ISA is not taxed, and the £20,000 limit stays intact. If you also hold prize-based savings, our Premium Bonds guide explains how the prize rate works.
Energy bills and cost-of-living help
- Electricity VAT: VAT on household electricity was cut from 5% to 0% from 1 October 2026, and the cut now lasts until July 2027. Which? expects it to take around £50 off the Ofgem price cap from April 2027.
- £100 one-off payment: about 20 million households in council tax bands A to D will receive £100 in their bank account from January 2027.
- Gas standing charges: they are to be removed, with fixed costs moved into the unit rate. The government estimates 60% of households would save an average of £45 a year, but Which? notes there is no start date and that suppliers are likely to raise unit prices.
Ofgem is due to announce the January to March 2027 price cap on 25 November. Our energy price cap January 2027 guide covers the forecasts and what to check before then.
More in News
Income tax, pensions and work
- Thresholds frozen: the personal allowance stays at £12,570 and the higher-rate threshold at £50,270 until 2031.
- Pension Tax Allowance: from 6 April 2027 to 5 April 2030 it stops tax on the state pension for pensioners with no other income, as Which? explains. Our State Pension April 2027 guide has the new rates.
- Minimum wage: up 3.9% from April 2027, taking the National Living Wage (21 and over) to £13.21 an hour and the 18 to 20 rate to £11.27.
- Trading allowance: tripled from £1,000 to £3,000 from 6 April 2027, which helps side-hustle earners. Freelancers should also check our Making Tax Digital deadlines guide.
- Parental pay: extended to more than 150,000 extra parents a year, including self-employed fathers: two weeks of support, up to £194 a week.
- Carer’s Allowance: the earnings cliff edge becomes a taper above the £204 weekly limit.
Driving, shopping and housing
- Fuel duty: frozen until July 2027, so the temporary 5p a litre cut stays.
- Mileage rates: set permanently at 55p a mile for the first 10,000 business miles and 35p after that, up from 25p.
- Grocery tariffs: import tariffs removed on more than 100 goods, with savings of up to £21 a year in the Treasury estimate Which? quotes.
The proposed Your First Home scheme is aimed at first-time buyers of new-build homes in England: a minimum 2.5% deposit plus a government-backed equity loan of 20% with an initial interest-free period. Which? lists pre-registration by the end of December 2026, applications from February 2027 and first loans from April 2027, with price caps of £650,000 in inner London and £500,000 in outer London. For where prices stand today, see our UK house prices guide.
Sensible steps after the Budget
These are general ideas, not personal advice:
- Check how much of your £20,000 ISA allowance you have used before the tax year ends on 5 April.
- Fold the £100 payment and the electricity VAT saving into your winter plan, using our Christmas budget planner.
- Do not act on rumours: wait for HMRC and GOV.UK guidance on any date that sources describe as unclear.
Frequently asked questions
Is the Cash ISA limit still £20,000?
Yes. The planned cut to £12,000 for under-65s was scrapped in the Budget, so the £20,000 limit stays for all adults.
When do the higher savings tax rates start?
Vanguard says tax rates on savings and property income rise from 6 April 2027. Which? gives the start as April in one place and spring in another, so confirm the exact date on GOV.UK.
Will my energy bill fall?
Electricity VAT stays at 0% until July 2027, which Which? expects to take about £50 off the price cap from April 2027. The next cap, due on 25 November, also depends on wholesale prices.
Who gets the £100 payment?
About 20 million households in council tax bands A to D, paid into bank accounts from January 2027.
Is the Your First Home scheme open yet?
Not yet. Which? describes it as proposed, with pre-registration due by the end of December 2026.
Sources: Which?, Money to the Masses, Vanguard, interactive investor, Portfolio Adviser and Ofgem.
