Most people will judge the Autumn Budget on 28 October by what it means for them personally. Will their take-home pay be impacted through freezing of tax thresholds or will changes to fuel and other duties impact their cost of living? Founders, business owners, and wealthier individuals will have their focus set on what it means for the assets they own and the businesses they run.

Apart from recent confirmation that capital gains tax rates will not rise, John Healey’s first Budget as Chancellor is lacking the daily ‘hit’ of budget leaks that we’ve all gotten used to in the run up to a budget.

Whilst a ‘wealth’ tax has been in the spotlight, this appears to have been put on the back burner for now and the last few days saw the Chancellor reassure the taxpayer that Capital Gains Tax rates would not increase and so there are glimmers coming through that the focus is not firmly set on the ‘wealthy’ this budget, despite the continued need and pressure for the UK to repair its public finances.

With the Labour manifesto having previously ruled out rises in income tax, National Insurance for ‘working people’ and VAT, the options quickly narrow. With the calming assurance of steady as we go on capital gains rates for now, that leaves inheritance tax, pensions, property and land still in the crosshairs. Most of which fall on individuals.

What we expect on 28 October

Where the money is likely to come from

Whilst an increase to Capital gains tax rates was one of the biggest risks, the UK taxpayer has been reassured by press remarks this week attributed to John Healey that this would not occur.

There had been a fear that rates could rise from the top level currently of 24% to around 30% or even higher.

Instead, the focus of the past few days has been around finding additional tax funding from institutions such as the banking sector, rather than from the individual. Of course, any increase in bank levy's is likely to find its way back to impacting the individual through the rise in the cost of lending.

Over recent months there has been increased reporting of the ‘tax squeeze’ that middle earners in the UK are facing, so can we expect an ease up in the Chancellor’s budget on the tax and living cost rises this cross-section face? The mood music seems to suggest so, with reporting indicating that John Healey will make the government’s Help to Buy scheme for first time buyers more generous to middle earners by lifting the earnings cap on who can benefit from government support. Of course, this scheme is England specific, and the other UK regions will need to wait and see what alternatives are available.

Frozen income tax thresholds will likely continue to play their part in this budget as in previous budgets, doing quieter work in the background, pulling more people into higher bands as pay rises without a single tax rate changing. The freeze on these thresholds is already locked in until 5 April 2031. Pension tax relief at source for higher earners also remains on the list of options available to the Chancellor, even after last year’s announced changes to salary sacrifice on pension contributions due to come in from 6 April 2029.

Founders are getting a raw deal

Business Asset Disposal Relief is worth far less than it was. Until 2020, entrepreneurs could claim relief on up to £10m of lifetime gains at 10%. Today the limit stands at £1m, taxed at 18% against a main rate of 24%, meaning the most a founder can save is £60,000.

That is a modest reward for the risk of building a business, especially compared with the support available to investors through schemes such as the Enterprise Investment Scheme. The government's recent call for evidence on tax support for entrepreneurs suggests it recognises the gap. A new or expanded relief for entrepreneurs to set up, grow and then exit their business is required. Whilst there are incentives available for founders to reinvest their gains in other UK businesses, there is no effective incentive to leave secure employment and ‘take a punt’ on a business venture. Making EIS available to founders would be a good starting point.

Where the Chancellor may hold back

Inheritance tax has rarely been out of the headlines, and the constant speculation is making planning harder. Major changes are still working through the system, including unused pensions being brought into the inheritance tax net from April 2027. With so many moving pieces, further reform in this Budget looks less likely, although nothing can be ruled out.

New carried interest rules for Private Equity executives need time to bed in. The rules moved into a new income tax regime on 6 April 2026, with a 72.5% multiplier that produces an effective rate of 34.075%, including National Insurance. Another overhaul so soon would unsettle fund managers deciding where to base themselves, so further immediate change looks unlikely.

Leaving the UK is already difficult to do, which makes an exit tax less likely than some individuals fear. The idea has been examined before by the UK government and judged difficult to apply. The new inheritance tax residence-based regime keeps people who leave the UK within the inheritance tax net for up to 10 years, and the Chancellor has recently spoken about stemming the departure of wealthy entrepreneurs. What the Chancellor’s plan is for stemming this exodus; we wait to hear, perhaps in this Budget.

Scotland faces a second Budget

For Scottish taxpayers they will have to read between the lines on budget day, as not all measures being introduced will directly apply, particularly when it comes to income tax, where income other than investment income is the domain of the Scottish Parliament. Scottish taxpayers will have to wait until December to understand the full effect on their personal finances. Already Scottish taxpayers pay at higher income tax rates than the rest of the UK and there is a recognition within the Scottish Government that to increase income rates still further could be detrimental to the Scottish income tax base. Asset-rich families, including rural landowners, are feeling layers of tax from both governments. Some are now questioning whether holding those assets for the next generation still makes sense.

What founders and individuals need

After several years of change, the people who build businesses and create wealth in the UK need two things most, certainty and a reason to keep taking risks. A Budget that took both seriously would deliver:

• a founders’ relief that properly rewards the risk of building a business, not a £60,000 ceiling
• stability on capital gains tax rates and the new carried interest regime, so people can plan a sale or raise a private equity fund with confidence
• a pause on inheritance tax changes so families can plan for the next generation

Until the detail is clear, flexibility is the best defence. Commercial needs should still drive decisions, but structures that leave room to adapt will cope better with whatever 28 October brings. To discuss how the Autumn Budget could affect you, speak to your usual Johnston Carmichael adviser or fill out the short form below.