Your First Home Scheme details have been announced. There will be a household income cap of £110,000 to be eligible for the scheme (£140,000 in London). The Chancellor has also announced local property price caps.
Lifetime ISAs: The Chancellor has confirmed plans that a new First Time Buyer ISA will replace the Lifetime ISA. He also pledged to change the withdrawal penalty on Lifetime ISAs so buyers purchasing above the property price limit get back at least what they paid in.
Energy bills: Standing charges will be scrapped from millions of household gas bills. Also, around 20 million households in council tax bands A–D in England will receive a £100 household energy payment this winter. The Chancellor also extended the cut to VAT on electricity bills until July 2027.
Higher taxes for landlords and savers: From April 2027, tax rates on rental income and taxable savings interest will rise to 24% for basic-rate taxpayers, 44% for higher-rate taxpayers and 49% for additional-rate taxpayers.
Other announcements included: Increasing the minimum wage and protection to shield pensioners from paying tax on state pension.
What didn’t happen – but could happen next: A number of changes that were predicted in the run up to the Autumn Budget 2026 have not happened, including Capital Gains Tax rises, lowering the threshold at which the mansion tax is payable and overhauling stamp duty and property tax.
New details of how the Your First Home Scheme will work were announced by the Chancellor in his Autumn Budget 2026.
The scheme is for first-time buyers in England who buy a new-build home from a participating developer. Buyers put down a 2.5% deposit, take out a 20% government equity loan and a mortgage for the remaining 77.5%.
In the Autumn Budget 2026, the Chancellor announced:
Household income caps to be eligible for the scheme: The maximum household income you can have to be eligible for this scheme is £110,000, rising to £140,000 in London.
Local property price capshave been set. Examples of local authority property price caps include £375,000 for properties in Reading, £355,000 in Manchester and £650,000 in inner London.
The equity loan will be interest-free for five years.
Pre-registration and guidance are expected by the end of December 2026. Applications are expected to open in February 2027, with the first property sales expected in April 2027. Buyers cannot apply yet.
For more information and a free Your First Home eligibility calculator read our guide to the Your First Home scheme.
Lifetime ISA to be replaced by a First Time Buyer ISA
The Chancellor confirmed plans to replace Lifetime ISAs with a new First Time Buyer ISA, which will replace the LISA for new accounts from April 2029. Unlike Lifetime ISAs, which can also be used to save for retirement, the new account will be aimed solely at first-time buyers.
Existing Lifetime ISA holders will be able to keep their accounts and continue using them under the existing rules, including for retirement.
From 29 October 2026, the Lifetime ISA withdrawal charge will fall from 25% to 20% for first-home purchases above £450,000, provided the other qualifying purchase rules are met. This removes the additional penalty on savers’ own contributions, but they will still lose the government bonus. Other unauthorised withdrawals will continue to attract a 25% charge.
At HomeOwners Alliance, we think it’s disappointing that the £450,000 property price cap will remain unchanged for both existing Lifetime ISAs and the new First Time Buyer ISA. Londoners buying above that threshold will continue to miss out on the government purchase bonus.
HomeOwners Alliance CEO Paula Higgins said: “The cap should reflect London’s housing market, rising to £500,000 in outer London boroughs and £650,000 in inner London boroughs. It should then increase annually in line with inflation to protect future buyers and prevent the value of this support from being steadily eroded.”
Find out more about the proposed changes and how the current accounts work in our guide to the best Lifetime ISAs.
Energy bills changes and help for low-income households
A number of changes relating to energy bills were announced in the Autumn Budget 2026:
£100 household energy payment: Around 20 million households in council tax bands A-D in England will receive a £100 payment this winter to help with rising energy bills. The Chancellor said it will be paid directly into bank accounts. The £2.6 billion scheme includes funding for the Scottish, Welsh and Northern Ireland governments to provide support too, although arrangements in those nations are yet to be confirmed.
Electricity VAT cut extended: The cut to VAT on domestic electricity bills from 5% to zero which came into effect in October 2026 will now last until July 2027. It had been due to end in March 2027.
Gas standing charges scrapped: Standing charges will be removed from household gas bills for around 23 million homes. These are fixed daily fees you pay even when you don’t use any gas. Instead, the costs will be added to gas unit rates. The government estimates that 60% of households with gas accounts could save an average of £45 a year. Lower users are expected to benefit most, but higher users could pay more. The government has asked Ofgem to deliver the change in 2027 or as soon as possible afterwards.
Electricity standing charges: These will remain for now, but the Chancellor said similar reforms would follow.
Individual landlords and people with savings outside ISAs may face higher tax bills from 6 April 2027, as a result of the Autumn Budget 2026. The Chancellor announced a further two percentage point increase in tax rates on property income and savings interest, on top of the two percentage point increase announced in last year’s Budget.
Tax band
Current rate
Rate from April 2027
Basic rate
20%
24%
Higher rate
40%
44%
Additional rate
45%
49%
For landlords: The new rates apply in England, Wales and Northern Ireland. Landlords pay tax on rental profits after allowable expenses.
For savers: The new rates apply across the UK to interest above your tax-free allowances. ISA interest remains tax-free, and the annual cash ISA allowance will stay at £20,000.
Other key announcements
The Chancellor also made a number of key announcements that may affect some homeowners and potential buyers too. These include:
Increasing the minimum wage by 3.9%, taking the rate for workers aged 21 and over to approximately £13.20 an hour from April 2027. The minimum wage for 18-to-20 year-olds will also rise by 3.9%, from £10.85 an hour to around £11.27.
Pensioner tax protection: A new Pension Tax Allowance will mean pensioners with total income up to the value of the full new state pension will not pay income tax for the remainder of this Parliament.
Fuel duty: The Chancellor has extended the 5p-per-litre cut until July 2027.
Bank tax: The bank surcharge will increase by 3 percentage points for 15 months from January 2027 to help fund immediate support with energy bills.
Cash ISAs: The annual cash ISA allowance will remain at £20,000. The Chancellor has scrapped the planned reduction to £12,000 for under 65s that was due to take effect from April 2027.
What didn’t happen – but could happen next
Capital Gains Tax rises
There was speculation that the Treasury could bring CGT rates closer to income tax rates but Chancellor John Healey ruled this out before the Budget.
CGT is particularly relevant to landlords and second-home owners because it may be payable on profits when they sell a property that isn’t their main home.
The ‘mansion tax’, officially called the High Value Council Tax Surcharge, had been predicted as another area that could be targeted in the Autumn Budget 2026.
Under the plans already announced, the mansion tax is due to apply from April 2028 to homes in England valued £2 million or more, with annual charges of £2,500-£7,500 depending on the value band.
There was speculation that the surcharge could be expanded in the Autumn Budget 2026, with reports suggesting the Government may consider lowering the £2 million threshold to £1.5 million and increasing the charges.
However, Chancellor John Healey ruled this out before the Budget, following opposition from Labour MPs concerned about the impact on homeowners in London.
The Autumn Budget 2026 took place on Wednesday 28 October 2026, when Chancellor John Healey set out the Government’s tax and spending plans. The Office for Budget Responsibility also published its latest economic and fiscal forecasts.
Could the Autumn Budget affect interest rates?
Yes, the Budget could influence the outlook for interest rates, particularly if tax and spending measures are expected to affect future inflation and economic growth.
However, the Bank of England sets interest rates independently and will consider the Budget alongside wider economic data. For more detailed information, read our guide to the Latest UK Interest Rate Forecasts.
Could the Budget affect mortgage rates?
Potentially. Fixed mortgage rates don’t simply follow the Bank of England base rate. Swap rates are the primary benchmark lenders use to price fixed-rate mortgages.
If announcements in the Budget change market expectations about the future path of interest rates, swap rates could rise or fall. If swap rates rise, lenders will typically increase fixed mortgage rates; if they fall, cheaper deals may become available. Find more information in our guide to Mortgage rate predictions 2026: Are mortgage rates going down?
When do Budget changes typically take effect?
It depends on the measure. Some tax changes can take effect on Budget day or shortly afterwards, while others may not start until the beginning of a future tax year or another date set by the Government.
October 28, 2026 
