The Autumn Budget 2026, announced on 28 October 2026, introduced significant reforms to employment taxes affecting both employers and employees. Key measures include an increase to the approved mileage allowance payments (AMAP) for business travel, upward adjustments to the National Living Wage and National Minimum Wage rates effective from April 2027, and a reform of the benchmark scale rate and overseas scale rate payments for subsistence expenses. These changes aim to reflect current economic conditions and simplify compliance. The revised AMAP rates will apply from 6 April 2027, while the new scale rates will require employers to update payroll systems and expense policies. ICAEW’s Tax Faculty highlights that employers should review their reimbursement arrangements ahead of the 2027/28 tax year to ensure correct operation of PAYE and avoid penalties.
Key Takeaways
- Mileage Allowance Update: The approved mileage rates for cars, vans, motorcycles, and bicycles have been increased, providing higher tax-free reimbursements for business travel.
- Minimum Wage Increases: The National Living Wage (for ages 21+) and National Minimum Wage rates for younger workers and apprentices will rise from April 2027, increasing payroll costs for employers.
- Scale Rate Simplification: The benchmark and overseas scale rates for subsistence have been restructured, reducing administrative burden but requiring updated policy documentation.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement