Autumn Budget 2026: what it means for side hustles, savings and ISAs
The October 2026 Budget explained for everyday money: the £3,000 trading allowance, the cash ISA U-turn, higher tax on savings and rental income, the minimum wage rise and more.
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The Chancellor, John Healey, delivered the Budget on 28 October 2026. Here is what changes for people earning on the side, saving and investing. Most measures still need to pass into law.
The changes at a glance
| Change | From | Who it affects |
|---|---|---|
| Trading allowance rises from £1,000 to £3,000 | 6 April 2027 | Anyone with side income |
| Cash ISA limit kept at £20,000 for everyone | Now | Savers, especially under-65s |
| Tax on savings interest rises by 4 points | 6 April 2027 | Savers above their Personal Savings Allowance |
| Tax on property income rises by 4 points | 6 April 2027 | Landlords, Airbnb hosts outside Rent a Room |
| National Living Wage rises to £13.21 an hour | April 2027 | Workers on the minimum wage |
| Business mileage after 10,000 miles rises to 35p | 6 April 2027 | Drivers claiming mileage |
| Lifetime ISA replaced by a First Time Buyer ISA | April 2029 | New first-home savers |
Sources: GOV.UK overview of tax legislation and rates and Which?.
Side hustles: the trading allowance triples
From 6 April 2027, the trading allowance rises from £1,000 to £3,000, and so does the point at which you need to tell HMRC about trading income. If you earn up to £3,000 a year from selling, making or small gigs, it is tax free and does not need reporting.
Above £3,000 you can still choose between the allowance and your actual expenses. The calculator below now has a 2027/28 setting.
Free toolSide hustle tax calculatorSee how much tax and National Insurance you owe on side income, and what to set aside each month.The Making Tax Digital timetable is unchanged: £30,000 from April 2027 and £20,000 from April 2028. HMRC will not give penalty points for late quarterly updates in 2027/28 to people joining in April 2027.
ISAs: the cash ISA cut is cancelled
The plan to limit under-65s to £12,000 a year in cash ISAs from April 2027 has been reversed. You can keep putting the full £20,000 into cash ISAs. The Budget also dropped a planned charge on uninvested cash in stocks and shares ISAs, according to Which?.
Savings and property: higher tax rates
From 6 April 2027, income tax on savings interest and property income rises to:
| Taxpayer | Rate now | From April 2027 |
|---|---|---|
| Basic rate | 20% | 24% |
| Higher rate | 40% | 44% |
| Additional rate | 45% | 49% |
Savings interest inside your Personal Savings Allowance, and inside an ISA, stays tax free. Income under the Rent a Room scheme stays tax free up to £7,500.
First-time buyers
- A new First Time Buyer ISA replaces the Lifetime ISA for new savers from April 2029, with up to £4,000 a year and a 25% bonus. Existing Lifetime ISAs carry on.
- The penalty for using a Lifetime ISA on a home over the £450,000 cap falls from 25% to 20%, from 29 October 2026.
Work and pay
- The National Living Wage rises by 3.9% to £13.21 an hour for over-21s, and to £11.27 for 18 to 20 year olds, from April 2027.
- From April 2029, people who make payments on account will make more regular, automated payments through the year instead of two large ones.
What to do now
- Side hustlers: if you earn between £1,000 and £3,000, your 2027/28 income will not need reporting. You still need to report 2025/26 and 2026/27 as normal.
- Savers: use your ISA allowance, especially if your savings interest is above your Personal Savings Allowance.
- Landlords: budget for the higher tax rate on rental profits from April 2027.
Common questions
When was the Autumn Budget 2026?
Wednesday 28 October 2026.
Is the cash ISA allowance still being cut to £12,000?
No. The Budget reversed it, so the cash ISA limit stays at £20,000 for everyone.
When does the £3,000 trading allowance start?
6 April 2027, the start of the 2027/28 tax year.
This is general information, not personal tax or financial advice. Tax rules change and depend on your circumstances, so check GOV.UK or speak to an accountant before acting.