Tax

Corporate Tax/Companies

Capital allowances

From 1 January 2026, there is a new 40% first year allowance for qualifying main-rate plant and machinery for companies investing from 2026.

From 1 April 2026, the main writing down allowance on main-rate plant and machinery is reduced from 18% to 14% per year. 

Business rates

Two permanently lower business rates multipliers for eligible Retail, Hospitality and Leisure properties with rateable values below £500k, 5p below national multipliers (small business RHL multiplier 38.2p, standard RHL multiplier 43.0p in 2026-27). 

There is a new high-value business rates multiplier for properties with rateable value ≥£500,000, set 2.8p above the national standard multiplier (50.8p in 2026-27).

Properties facing large bill increases after revaluation from 1 April 2026 are to benefit from 3-year transitional relief, partly funded by a 1p transitional relief supplement in 2026/27.

There is a new single rating assessment for serviced office operators as the starting position. Operators will need to submit a ‘Check Case’ to the Valuation Office Agency to begin the challenge process.

PAYE changes 

From April 2026, the Government is tackling tax non-compliance in umbrella companies by moving PAYE obligations to recruitment agencies or, where an agency is not present, end client businesses.

Share incentives and tax planning

The Government will reduce the Capital Gains Tax relief available on qualifying disposals to Employee Ownership Trusts from 100% of the gain to 50%. This will be legislated for in the Finance Bill 2025-26 and took effect from 26 November 2025.

From 6 April 2026, Enterprise Management Incentives (EMI) eligibility will widen so that more scale-ups (not just start-ups) can use EMI options, subject to revised size and conditions rules. The requirement to notify HMRC of EMI option grants will be completely removed from 6 April 2027. 

Indirect Tax

Electric Vehicle Excise Duty

There will be a new mileage charge for electric and plug-in hybrid cars from 2028 and electric cars will pay half the equivalent fuel duty rate for petrol and diesel cars.

Gambling tax

From 1 April 2026, Remote Gaming Duty will increase from 21% to 40% and Bingo Duty will be abolished.

VAT

From 1 April 2026, there will be a new VAT relief for business donations of goods to charity for onward distribution or use in the delivery of their services.

Suppliers of private hire vehicle and taxi services will be excluded from the scope of the Tour Operators’ Margin Scheme from 2 January 2026, except where these are supplied in conjunction with certain other travel services.

Fuel duty

The 5p cut has been extended for a further five months, now ending in August 2026.

High Value Council Tax Surcharge

From 1 April 2028, a new ‘high-value property surcharge’ will apply to homes valued at £2 million or more. This will rise to £7,500 per year for properties valued above £5 million.

Air Passenger Duty

The scope of the higher rate has been extended to cover all private jets over 5.7 tonnes from 1 April 2027.

Pensions Salary Sacrifice Cap

National Insurance exemptions on pension contributions via salary sacrifice schemes will be capped, with contributions above £2,000 annually subject to National Insurance from April 2029.