Chancellor of the Exchequer Rachel Reeves delivered the Autumn Budget on 26 November 2025, which included changes to property tax and the housing market. Here’s a rundown of what the announcements mean for those in the property sector:
Businesses
The Writing Down Allowance (WDA) main rate will reduce from 18% to 14% starting from April 2026. This reduction in tax relief applies to both corporation tax paying companies and unincorporated businesses (sole traders) in the self-assessment regime for expenditures that do not qualify for full expensing, such as second-hand assets and cars.
The freeze on the employer National Insurance Contributions (NICs) secondary threshold (which applies above the lower earnings limit) was extended for a further three years until 2030-31. From April 2029, salary-sacrificed pension contributions above an annual £2,000 threshold will no longer be exempt from NICs. These contributions will become subject to both employer and employee NICs.
There will also be changes to business rates, providing lower multipliers for retail, hospitality, and leisure properties. It also includes a package of transitional relief intended to cap increases following the 2026 revaluation.
Additionally, agencies employing staff will be impacted by National Minimum Wage increases from April 2026:
Over-21s: £12.71 per hour
Ages 18–20: £10.85 per hour
Under-18s and apprentices: £8 per hour
Home buying and selling
A High Value Council Tax Surcharge will be introduced on properties valued over £2 million starting from April 2028. The surcharge ranges from £2,500 to £7,500 a year across four price bands.
Private rental sector and short-term lets
From April 2027, there will be a 2% increase to rates of property income tax.
The new rates will be:
- 22% for the basic rate
- 42% for the higher rate
- 47% for the additional rate
In addition to this, the tax rates for dividend income are increasing. From 6 April 2026, the basic rate will increase from 8.75% to 10.75% and the higher rate will increase from 33.75% to 35.75%.
Contact us on 01905 777600 or email hello@ormerodrutter.co.uk for more information.
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