I got the Budget wrong. Here's what actually changed

Before the Budget I wrote down what I thought was coming. Marking your own homework is uncomfortable, but it's only fair, so here it is. I got the big one wrong, and I'm pleased about it.

What I got wrong

The cash ISA cut didn't happen. The plan to limit under-65s to £12,000 a year in cash was dropped. The full £20,000 allowance can still go into cash, whatever your age.

The Lifetime ISA replacement is later than expected. The new First Time Buyer ISA arrives in April 2029. I'd expected 2028.

Savings interest is about to cost more

This is the change that will reach the most people. From 6 April 2027, tax on savings interest rises to 24%, 44% and 49%, depending on your tax band. That's four points higher than the rates on earnings. Rental income gets the same increase.

Your allowances haven't changed. A basic-rate taxpayer still gets £1,000 of interest tax-free and a higher-rate taxpayer £500. But at 4% interest, a higher-rate taxpayer uses that up with £12,500 in savings.

Put those two changes together and the conclusion is simple. Cash ISAs survived, and they've become more valuable. If you have savings outside an ISA and allowance left this year, using it before April is worth more than it has been for a long time.

First-time buyers

The First Time Buyer ISA keeps the parts of the Lifetime ISA that worked: £4,000 a year, a 25% bonus and a £450,000 property limit. The bonus is paid when you buy, and there's no retirement option.

Two things matter now:

• Existing Lifetime ISAs carry on. Nothing is being taken away from anyone who has one.
• The penalty has been fixed. If you buy a first home above the price cap, the withdrawal charge is now 20%, which takes back the bonus and nothing more. Before, you lost some of your own money as well.

If you're under 40 and think you might want one, opening a Lifetime ISA with a small amount still looks sensible while you can. I wrote about why here.

A trap removed for bereaved families

When someone dies before 75, their pension can usually be passed on free of income tax. There used to be a catch: it had to be sorted out within two years, or the tax-free treatment was lost. Families who were grieving, or who simply didn't know the pension existed, got caught.

That two-year rule has gone for payments from 28 October 2026. It won't make headlines, but it's a kind change.

It doesn't alter the bigger one. From April 2027, unused pensions count towards your estate for inheritance tax. If you haven't looked at what that does to your position, the inheritance tax calculator is a good place to start.

Selling a business

The lifetime limit for Business Asset Disposal Relief halves from £1 million of gains to £500,000 for sales from 6 April 2027. A new Founders' Relief arrives alongside it for some founders of growing companies. If a sale is on the horizon, the date now matters.

The quiet ones

• Tax thresholds are frozen until April 2031. Every pay rise pulls a little more of your income into tax without any rate changing.
• The State Pension rises to £13,036.40 a year from April 2027.
• The triple lock may not last. The government has proposed a double lock from 2030: the higher of inflation or 2.5%.
• The trading allowance rises to £3,000 from April 2027, which helps anyone with a small side income.

What I'd do before 5 April

1. Move savings into a cash ISA if you have allowance left.
2. Check whether your interest next year will go over your savings allowance.
3. If you hold savings as a couple, look at whose name they're in. The lower earner pays less.
4. If you own a business you might sell, speak to your accountant about timing.
5. Add your pension to your estate and see what the total looks like.

None of this needs doing in a panic. Most of it takes an evening.

This article is for general education only and isn't personal advice. It reflects the October 2026 Budget as announced, and details can change as legislation passes.