Autumn Budget 2026 What It Means for Business Owners and Families

The Autumn Budget has now been delivered, bringing several changes for business owners, families and anyone reviewing their longer-term financial or estate planning.

Some of the announcements will not take effect immediately, while others build on changes that were already due to come into force. For many people, the most useful response will be to look at how the changes fit with plans they already have, rather than reacting to one Budget measure in isolation.

Our Corporate and Private Client teams have picked out some of the areas worth considering.

What does the Budget mean for business owners?

For business owners, several of the announcements could influence decisions around selling a business, rewarding employees and restructuring companies over the next few years.

Business exits and Business Asset Disposal Relief

From April 2027, the lifetime limit for Business Asset Disposal Relief is due to reduce from £1 million to £500,000.

For shareholders considering a sale, that could affect the amount of Capital Gains Tax payable and ultimately the proceeds they retain from an exit.

Anyone already thinking about selling should therefore consider likely timescales alongside the wider commercial position. Bringing a sale forward will not automatically be the right answer, but understanding the tax impact early gives owners more information when deciding when and how to proceed.

Founders’ Relief

The proposed introduction of Founders’ Relief from April 2027 could create a new opportunity for some founders and early investors in high-growth businesses.

Based on the proposals announced so far, qualifying individuals could benefit from a 10% Capital Gains Tax rate on up to £10 million of lifetime gains.

The eligibility criteria may be relatively narrow, and the proposal remains subject to consultation, which is due to close on 30^th November. Business owners who believe they may qualify should therefore keep an eye on how the final rules develop.

EMI2 and employee incentives

The existing Company Share Option Plan is being rebranded as Enterprise Management Incentives 2, or EMI2, alongside changes intended to broaden its use.

From April 2027, the individual option limit is due to increase from £60,000 to £120,000, while the maximum tax-advantaged exercise period will extend from 10 years to 15 years.

For businesses looking at how they attract, retain and incentivise key employees, this could make share options worth revisiting as part of the wider remuneration package.

Restructuring and investment

Further changes are proposed from April 2028 around the tax treatment of company distributions and returns of capital.

These could become relevant where businesses are considering reorganisations, demergers or separating different activities within a corporate group, particularly where the longer-term plan may involve a sale.

Business owners with personally held rental property may also want to review their wider position ahead of higher Income Tax rates on rental income from April 2027. Moving property into a company will not automatically be tax-efficient, so any restructuring needs to be considered in the round rather than in response to one tax change.

What does the Budget mean for individuals and families?

For families, the Budget did not introduce a dramatic overhaul of Inheritance Tax, but several changes could still affect existing estate plans.

The wider question for many people is whether arrangements put in place several years ago continue to work as intended.

Pensions and Inheritance Tax

One of the most significant changes remains the treatment of pensions from 6 April 2027.

Most unused pension funds and certain pension death benefits are still due to fall within the scope of Inheritance Tax, and the Budget introduced further provisions dealing with how tax relating to pension death benefits will be administered.

For families who have previously viewed pensions as an efficient way of passing wealth to the next generation, this may change how pensions fit within the wider estate plan.

A pension that previously sat largely outside the Inheritance Tax calculation may therefore need to be considered alongside property, savings, investments and other assets.

Inheritance Tax thresholds remain unchanged

The main Inheritance Tax thresholds remain in place, with the nil-rate band at £325,000 and the residence nil-rate band at £175,000.

For many families, the more important issue is that those thresholds remain frozen while the value of property and other assets can continue to change.

An estate that appeared comfortably below the threshold several years ago may therefore look quite different when reviewed today, particularly where property values, investments or pension wealth have increased.

Trusts may need another look

The Budget also introduced technical changes affecting the deduction of certain liabilities involving trusts for Inheritance Tax purposes, applying to deaths and relevant chargeable events on or after 28^th October 2026.

Families who already have trusts in place, particularly where those arrangements form part of older or more complex estate planning, may want to review whether they continue to operate in the way originally intended.

Property, savings and investments

From April 2027, new Income Tax rates of 24%, 44% and 49% will apply to savings income, with equivalent property income rates applying in England, Wales and Northern Ireland.

What should you do following the Budget?

There is rarely a good reason to make immediate changes simply because of a Budget headline, but there is value in checking whether existing plans still reflect the current rules and your own circumstances.

For business owners, that may mean revisiting an intended sale, succession plan, employee share scheme or corporate structure.

For individuals and families, it may mean reviewing a Will, pension arrangements, trusts or the overall value and composition of an estate.

mlplaw’s Corporate and Private Client teams can advise on how the Autumn Budget may affect your business, estate planning or longer-term arrangements.