The Autumn Budget 2026, delivered on 28 October 2026, leaves the headline rates of Capital Gains Tax and dividend tax where they are for 2027-28. The big change for savers is a further rise in the tax on savings interest from 6 April 2027. The cash ISA cut announced last year is cancelled, the Lifetime ISA gets a lower charge for homes above its price cap, and business owners face a smaller Business Asset Disposal Relief limit. For every other measure, see our Autumn Budget 2026 summary.
What changed at a glance
| Measure | Before | After | From |
|---|---|---|---|
| Savings income tax rates (basic / higher / additional) | 20% / 40% / 45% | 24% / 44% / 49% | 6 April 2027 |
| Cash ISA limit for under-65s | £12,000 planned | £20,000 (cut cancelled) | 6 April 2027 |
| Lifetime ISA charge, home above the £450,000 cap | 25% | 20% | 29 October 2026 |
| BADR lifetime limit | £1 million | £500,000 | 6 April 2027 |
| Founders’ Relief | none | 10% on up to £10 million of lifetime gains | 6 April 2027 |
Savings interest: rates rise again from April 2027
Budget 2025 had already legislated separate savings rates of 22%, 42% and 47% from April 2027. Budget 2026 adds a further two points at each band from the same date, so savings income will be taxed at 24%, 44% and 49%. These rates apply across the UK, including to Scottish taxpayers.
What does not change: the Personal Savings Allowance stays £1,000 for basic rate and £500 for higher rate taxpayers in 2027-28. Interest inside an ISA stays tax-free. The Tax on Savings Interest page shows how much of your interest is taxable, and the savings and dividend allowance optimiser shows where your allowances run out.
ISAs: the cash ISA cut is cancelled
Autumn Budget 2025 announced that from 6 April 2027 savers under 65 could put only £12,000 a year into cash ISAs. Budget 2026 reversed that before it took effect: the cash ISA limit stays £20,000 for everyone, inside an overall ISA allowance that also stays £20,000. The Junior ISA limit stays £9,000. HM Treasury will also design a new incentive for people putting money into a Stocks and Shares ISA for the first time; the details are not out yet. See ISA allowance rules.
Lifetime ISA. From 29 October 2026, a first-time buyer who uses a Lifetime ISA towards a home costing more than the £450,000 price cap pays a 20% withdrawal charge instead of 25%. Every other unauthorised withdrawal still costs 25%. From 6 April 2029 a new First Time Buyer ISA replaces the Lifetime ISA for new savers; existing holders can keep paying in and using their accounts under the current rules. The Lifetime ISA calculator applies the new charge.
Capital Gains Tax: rates unchanged, BADR limit halved
The main CGT rates stay 18% on gains within your basic rate band and 24% above it, and the annual exempt amount stays £3,000 for 2027-28.
The change is for business owners. For disposals from 6 April 2027, the lifetime limit on gains that qualify for Business Asset Disposal Relief falls from £1 million to £500,000. The BADR rate itself stays 18%. A new Founders’ Relief charges 10% on up to £10 million of lifetime gains for qualifying founders of high-growth, innovative companies, also from 6 April 2027. Who counts as a qualifying founder has not been published yet. The BADR calculator and Capital Gains Tax calculator both show the April 2027 limit.
Dividends: no change this time
Basic and higher rate dividend tax rose by two points in April 2026. Budget 2026 does not move the rates again: HMRC’s table keeps the rates at 10.75%, 35.75% and 39.35% for 2027-28, and the dividend allowance at £500. Our April 2026 dividend tax article covers the last rise, and the Dividend Tax calculator works out your bill.
What to do now
- Check how much interest you earn outside an ISA. If it already goes over your Personal Savings Allowance, it will be taxed at the higher rates from 6 April 2027. Use the savings and dividend allowance optimiser.
- Use your ISA allowance. The full £20,000 stays available in cash or stocks and shares. See ISA allowance rules.
- Planning to sell a business? The BADR limit falls for disposals from 6 April 2027. Run the numbers in the BADR calculator and take advice before acting.
Summary
Budget 2026 raises the tax on savings interest to 24%, 44% and 49% from 6 April 2027 and halves the BADR lifetime limit to £500,000. It keeps the cash ISA limit at £20,000 and leaves the rates and allowances for Capital Gains Tax and dividends unchanged for 2027-28. Most measures still need Finance Bill 2026-27 before they become law.