UK and International Tax news
Finance Act 2026
Thursday 9th April 2026
The Finance Bill 2025-26 received Royal Assent and became Finance Act 2026 on 18 March 2026. The Act gives effect to announcements made in the Autumn Budget 2025 and earlier, and includes the following measures:
- increases of 2% in the income tax rates applicable to income from property and savings from April 2027, with the basic, higher and additional rates increasing to 22%, 42% and 47%.
- increases to limits applying to EMI and EIS schemes, and a reduction in the rate of tax relief available to investments in VCTs.
- abolition of the notional tax credit on distributions received by non UK residents.
- a new first year allowance of 40% and a reduction in writing down allowances to 16% for expenditure on plant and machinery.
- restriction of 50% to the relief on disposals to employee ownership trusts.
- amendments to the rules for taxing carried interest.
- changes to anti avoidances rules applying to share reorganisations.
- introduction of a new requirement to claim incorporation relief.
- replacement of diverted profits tax with provisions to tax transfer pricing profits within corporation tax.
- changes to the definition of permanent establishment.
- a new power for HMRC to make regulations requiring the reporting of information on international controlled transactions.
- changes to Making Tax Digital for Income Tax.
- prohibition of promotion of certain tax avoidance arrangements.
- tax adviser registration, conduct and sanctions.
- reform of agricultural property and business property reliefs for IHT.
If you would like more information on the above, please contact Keith Rushen on 0207 486 2378.
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