Chancellor John Healey delivered the Autumn Budget on 28 October 2026. For most businesses, the headline changes take effect from April 2027. That is right in the middle of the budget most finance teams are building now. So the question from the board is simple: what does this mean for us, and is it in the numbers yet?
This article sets out the Budget changes that affect business costs and forecasts, shows a worked example, and explains how to get your forecast updated quickly.
The changes that land on the finance team’s desk
These are the main Budget measures that affect business forecasts. Most still need to pass through the Finance Bill, so check the final legislation before you lock your numbers.
| Measure | Change | From | Forecast line affected |
|---|---|---|---|
| National Living Wage (21 and over) | £12.71 to £13.21 an hour (+3.9%) | 1 April 2027 | Payroll, employer NI, pensions |
| Minimum wage (18 to 20) | £10.85 to £11.27 an hour | 1 April 2027 | Payroll |
| Employer National Insurance | No change to headline rates | – | Payroll on-costs |
| Income tax thresholds | Frozen until 2031 | – | Pay negotiations, reward |
| Corporation tax | Main rate stays at 25%; full expensing retained | – | Tax charge, cash flow |
| First-year allowance (main rate) | 40% to 50% | Spending from 1 January 2027 | Capex timing, tax |
| Main pool writing-down allowance | 14% to 12% | April 2027 | Tax charge |
| Small business rates relief (England) | Full relief threshold £12,000 to £18,000 rateable value; taper to £21,000 | April 2027 | Property costs |
| Business mileage rate | 55p for the first 10,000 miles made permanent; 25p to 35p above that | April 2027 | Travel expenses |
| Benefits in kind | Payrolling becomes mandatory | April 2027 (some benefits 2028) | Payroll processes |
| Fuel duty | Frozen | Until July 2027 | Fleet and logistics costs |
| Energy-intensive manufacturers | Electricity discount of up to 25% under the British Industrial Competitiveness Scheme | April 2027 | Energy costs |
| Online marketplaces | Platforms collect VAT on sales by UK sellers | October 2027 | Pricing, margin, cash flow |
| Business Asset Disposal Relief | Lifetime limit £1m to £500,000 | 6 April 2027 | Owner exit planning |
Some sectors have their own changes, including a higher bank corporation tax surcharge, a rise in Machine Gaming Duty and extra business rates relief for pubs and live music venues. Your adviser can confirm what applies to you.
A worked example: the National Living Wage
Take a business with 120 full-time employees on the National Living Wage, each working 37.5 hours a week.
| Pay rise per hour | £0.50 |
| Extra pay per employee per year (37.5 hours × 52 weeks) | £975 |
| Plus employer National Insurance at 15% | £146 |
| Extra cost per employee | £1,121 |
| Extra cost for 120 employees | £134,550 a year |
That is before employer pension contributions, and before the knock-on effect on staff paid just above the minimum, who will expect their pay gap to be kept. For many businesses, protecting pay differentials costs more than the rise itself.
In a driver-based model, this is one change: update the hourly rate from April 2027 and the impact flows through payroll, on-costs, the profit and loss account and cash. In a spreadsheet model, it can mean editing dozens of tabs, checking every link and hoping nothing was missed.
Why some teams will answer in minutes and others in days
The difference is not how hard the finance team works. It is how the plan is built.
- Hard-coded spreadsheets hold the result of a calculation, not the calculation itself. Change the wage rate and someone has to find every place it was used.
- Driver-based plans hold the assumptions (headcount, hours, rates, allowances) separately from the outputs. Change an assumption once and everything that depends on it updates.
Our guide to driver-based planning explains the approach in more detail, with examples.
Five steps to get your forecast Budget-ready
1. List the drivers the Budget touches
Go through the table above and note which assumptions in your model each change affects: hourly rates, on-cost percentages, rateable values, allowance rates, mileage rates and energy prices.
2. Phase the changes by month
Not everything starts in April. The higher first-year allowance applies to spending from 1 January 2027, and the marketplace VAT change starts in October 2027. If your financial year does not start in April, make sure each change lands in the right month.
3. Look beyond the direct cost
Pay differentials, supplier price rises passed on to you, and customer demand all move with the Budget. The Office for Budget Responsibility expects inflation to rise again in early 2027 before falling back to 2% during 2028.
4. Run scenarios, not a single number
Model a base case and at least one downside, for example a larger pay settlement to protect differentials or slower sales growth. Boards want to see the range, not just the central estimate.
5. Review capital spending timing
With the first-year allowance rising to 50% from January 2027 and the writing-down allowance falling to 12%, the timing of investment now has a clearer tax effect. It is worth reviewing your capex plan with your tax adviser.
Making the next change an update, not a rebuild
This will not be the last change of the year. Wage settlements, energy prices and interest rates will all move before the next Budget. The finance teams that cope best are those whose planning is connected and driven by assumptions, so each change is a quick update.
Jedox lets finance teams build driver-based budgets and forecasts on one connected platform, with scenarios side by side and every version saved. If moving to a rolling forecast is on your list, the Budget is a good prompt to start. And if you need to win the investment internally, our guide on how to build a business case for FP&A software includes free templates.
If the Budget has left your team rebuilding spreadsheets, book a discovery call with Kybos.
Frequently asked questions
When was the Autumn Budget 2026?
Chancellor John Healey delivered the Autumn Budget on 28 October 2026. Most of the measures affecting businesses take effect from April 2027.
What is the National Living Wage from April 2027?
The National Living Wage for workers aged 21 and over rises from £12.71 to £13.21 an hour from 1 April 2027, an increase of 3.9%.
Did employer National Insurance change in the Autumn Budget 2026?
No. The headline rates of employer National Insurance were not changed. Employers will still pay more where wages rise, because National Insurance is charged on higher pay.
How should finance teams update their forecast for the Budget?
List the assumptions each measure affects, phase each change into the right month, include knock-on effects such as pay differentials, model more than one scenario and review the timing of capital spending.
About Kybos
Kybos is a dedicated UK & Ireland Jedox Platinum partner. We build planning and analysis solutions that deliver value fast using accountancy qualified consultants. Whether you want a fully customised application or to build upon an existing solution, Kybos consultants are here to help.