A straightforward analysis from a fellow taxpayer.

Like most of you, I watched the Budget waiting for the bits that hit us hardest.

Here’s the plain-English version – no spin, no 154-page jargon – just the changes that will affect your take-home pay, your buy-to-let portfolio, your pension pot, and the car you live in five days a week.

The Three Changes That Will Cost You Real Money

1. Dividend Tax Up 2% from 6 April 2026If you run a limited-company practice and take most of your money as dividends, this is the single biggest hit.

New Rates:

• Basic rate: 8.75% → 10.75%
• Higher rate: 33.75% → 35.75%
• Additional rate: Remains 39.35%
• Dividend allowance stays at £500

Real-life impact:

If you take £60,000 in dividends (as a higher-rate taxpayer with a standard salary mix), this 2% hike means you are looking at roughly £1,100 less in your pocket every year for doing exactly the same work.

2. Separate (and Higher) Tax Rates on Rental Income from 6 April 2027

Many RPSA members have one or more buy-to-lets as their long-term pension. The Chancellor just made them less profitable by decoupling property tax from standard Income Tax rates.

(Important Note: These new rates apply only to property income. The trading profits from your surveying practice will continue to be taxed at standard Income Tax rates.)

• New Property Income Rates:
  • Basic rate: 22% (currently 20%)
  • Higher rate: 43% (currently 40%)
  • Additional rate: 47% (currently 45%)

Real-life impact: On £15,000 of net rental profit for a higher-rate taxpayer:

• 2026/27 tax year: £6,000 tax
• 2027/28 onwards: £6,450 tax
• Result: £450 extra tax per property, per year.

3. Savings Income Tax Also Rises in 2027. The tax on savings interest is following a similar path. From April 2027, the rates move to 22% (Basic), 42% (Higher), and 47% (Additional). Anyone sitting on decent cash buffers (common among sole traders to protect against downtime) will feel this.

The Big Planning Opportunity That Is Still Wide Open: Pensions

It wasn't all bad news. The £60,000 Annual Allowance is untouched.

If you have a bumper year, you (and your spouse/partner) can still shelter up to £120,000 combined from tax this year and next. Higher-rate money goes in, grows tax-free, and usually comes out at the basic rate in retirement.

Salary Sacrifice Update (April 2029): The government is capping the National Insurance relief on salary sacrifice contributions at £2,000 per year.

• Crucial Detail: This cap applies only to NIC relief. You can still contribute more than £2,000 via salary sacrifice and receive full Income Tax relief on the entire amount. For most surveyors, this remains a highly efficient way to extract profit.

Motoring – The Truth About Cars, Hybrids and the New eVED

We all clock serious miles. Here is the reality of the changes:

• Electric Vehicle Excise Duty (eVED): The Budget confirmed a new mileage-based levy on electric and plug-in hybrid cars, effective from April 2028. EVs will pay half the equivalent fuel duty rate; plug-in hybrids will pay one quarter.
  • Impact: If you drive 20,000 business miles/year in an EV, expect to pay roughly £180–£220 extra per year from 2028.
• Hybrids & BiK: While there is no sudden new tax hike in this Budget, the Benefit-in-Kind rates for hybrids are on a pre-set upward trajectory. However, a temporary easement has been introduced (Jan 2025 – Apr 2028) to stop the tax jumping too drastically due to new emission standards.
• Expensive Car Supplement: The threshold rises to £50,000 for zero-emission vehicles only from April 2026. This saves ~£440/year if you want a long-range Tesla or similar for work.
• Employee Car Ownership Schemes (ECOS): Reforms have been delayed until 6 April 2030. If you use one of these schemes, you have time to plan, but the tax perks are eventually disappearing.

Bottom line: eVED is coming, but you have 2½ years to plan. If you’re due a new vehicle, going full electric before April 2027 still makes strong tax sense, as it lets you claim 100% first-year capital allowances.

Digital Admin – It’s Coming, But It’s Not All Bad

From April 2027, most benefits-in-kind and expenses must be reported in real time through payroll software.

If you already use Xero, Sage, QuickBooks, or FreeAgent, you are likely fine. If you are still on spreadsheets, 2026 is the year to switch. Also, from Spring 2026, HMRC goes "digital by default" – you will get letters online unless you specifically opt out.

I’ve used Xero in my practice for years – it’s genuinely easier than paper once you’re set up.

House Prices & Transactions – The OBR View

The Office for Budget Responsibility (OBR) has crunched the numbers:

• House-price growth: ~3% in 2025, then averaging ~2.5% (2026–2030).
• Property Tax Impact: The new property income taxes are expected to shave ~0.1% off annual growth from 2028.
• Mortgage Rates: Expected to settle around 5% by 2029.
• Transactions: Rising from 1.1m to 1.3m by 2029.

Translation: Demand for surveying work looks solid and steady, but don’t bank on another 2021-style frenzy.

Quick Checklist – What to Do Before the Deadlines

If you run a limited company:

☐: • Consider declaring an extra dividend before 5 April 2026. 

☐ Review your salary vs. dividend mix with your accountant. 

☐ Warning: Ensure Corporation Tax returns are bullet-proof—late-filing penalties double from April 2026.

If you have buy-to-lets:

☐: Recalculate your net yield using the new 43% (higher) or 47% (additional) tax rates. 

☐ Look at transferring income-producing properties to a lower-tax spouse if sensible.

If you’re building your pension:

☐ Max out your £60k allowance (and spouse’s) while it’s still simple. ☐ Aim to do this before salary-sacrifice NICs kick in (2029).

If you’re due a new vehicle:

☐ Seriously look at full electric before April 2027 to grab 100% allowances and dodge eVED for longer.

Free Help for RPSA Members

Craig, our partner accountant, is offering every RPSA member a free 30-minute phone or Zoom consultation to run your exact numbers and spot anything you can still do before April 2026.

Just drop him an email: craig@csmaccountancy.co.uk(Mention you’re RPSA – he’ll prioritise you).

This Budget adds cost and complexity, but it hasn’t yet closed the sensible planning doors. The next 12–18 months are your window to protect as much of your income and wealth as possible.

We’re all in this together. If you have questions, fire them over to Craig or me – that’s what the RPSA is here for.

Keep surveying, keep professional, and keep a close eye on your bottom line.

Andrew McCollChairman, RPSA

Video overview below - hopefully not too cheesy.