September 23rd 2026
September 23rd 2026
The Chancellor will deliver the UK Autumn Budget on 28 October and speculation about what it might contain is now starting to build.
As always, business owners across the country are watching closely and Scottish business owners have an extra layer to think about, since Holyrood will be running its own numbers later on.
Little is confirmed at this stage but based on what is being widely reported and discussed, here is what we think is worth keeping an eye on as the big day draws nearer.
We will also look at what you can sensibly do now regardless of what the Chancellor eventually announces.
The new Chancellor has been open about wanting to focus on investment, innovation and job creation, with a particular commitment to tackling youth unemployment among the roughly one million 16 to 24 year olds who are not in education, training or work.
The ambition is clear, but the fiscal backdrop is less so, especially as the Government remains committed to its own borrowing rules.
Bond market interest rates keep climbing, defence spending needs to rise and the tax yield collected so far has come in lower than forecast, which all adds challenge.
Add in pressure to protect the pensions triple lock and there is very little room to manoeuvre without either raising taxes or cutting spending elsewhere.
Given the manifesto pledge not to raise headline rates of Income Tax or National Insurance, most commentators expect any tax rises to come through changes to thresholds, allowances and reliefs rather than the rates themselves, with a potential focus on assets over income.
Rumours around Capital Gains Tax (CGT) have been circulating for weeks, particularly among business owners weighing up a future sale or exit.
The suggestion is that CGT could be brought closer into line with Income Tax.
Under current rules, CGT on qualifying business assets stands at 18per cent for basic rate taxpayers and 24per cent for higher rate taxpayers, with Business Asset Disposal Relief offering a reduced rate of 18per cent on the first £1 million of qualifying lifetime gains.
If rates were aligned with Income Tax, some business owners could face rates of up to 40per cent or 45per cent on disposals, a significant hit to the net proceeds of a sale.
It is worth remembering that we have been here before. Similar speculation has surfaced ahead of previous Budgets and for most unlisted businesses, finding a buyer and completing a sale from a standing start within a matter of weeks simply is not realistic.
A rushed sale for tax reasons alone is rarely the right decision and selling purely to beat a rumour that may never materialise carries its own risks.
Beyond CGT, there is talk of possible increases to Inheritance Tax retirement relief limits, potentially up to £5 million or £10 million, which would be welcome news for owners planning succession.
There is also hope in some quarters for a reduced VAT rate for hospitality businesses, bringing the UK closer in line with European competitors.
None of this is confirmed and the Chancellor may well spring a surprise or two. As ever, the safest approach is to plan around your own circumstances rather than around rumours.
Because Scholes operates in Scotland, it is worth being clear about what the UK Budget does and does not change for our clients on this side of the border.
CGT and Inheritance Tax are both reserved matters, alongside defence spending, so whatever the Chancellor announces on 28 October will apply in Scotland exactly as it does everywhere else in the UK.
Income Tax rates and bands and property transaction taxes such as Land and Buildings Transaction Tax, are devolved and set separately by the Scottish Government.
This year, that separation matters more than usual. The Scottish Government has confirmed that its own draft Budget for 2027-28 will not be presented until 3 December, giving ministers time to absorb the implications of the UK Budget before setting Scotland’s own tax and spending plans.
With a new Scottish Parliament elected in May and a new Scottish Government now in place, there is genuine uncertainty about which direction Holyrood will take once it has that information.
For Scottish business owners, this means two Budgets to watch rather than one, with a five week gap in between during which the picture may keep shifting.
Rather than waiting to see what either Budget contains, there is plenty business owners can do in the meantime to be properly prepared.
It is important to think about what actions are currently in play and how they might be affected by a sudden change in policy in the coming weeks.
Some scenarios that may require some additional planning include:
Accelerating your plans before the Budget may give some certainty to your situation, as you can rely on existing rules, rather than having to second guess any changes.
This should ensure that you are not left worse off, even if the Budget doesn’t result in significant changes to taxation.
Whatever the Chancellor and the Scottish Government eventually decide, being prepared puts you in a stronger position than reacting after the fact.
If you would like to talk through what any of this could mean for you or simply want a clearer picture ahead of 28 October and 3 December, we would be glad to help.
Get in touch with the team at Scholes
