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Raise the trading allowance to £3,000 from 6 April 2027 (Budget 2026) - #2713

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Raise the trading allowance to £3,000 from 6 April 2027 (Budget 2026)#2713
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@MaxGhenis MaxGhenis commented Oct 28, 2026 •
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Draft: Budget week. Not for merge until the Budget-week merge rules lift.

Part of moving the Autumn Budget 2026 household measures from the dashboard repo's reforms (PolicyEngine/uk-autumn-budget-dashboard-2026#290) into current law here. This one is Table 6.1 item 15.

What and why

Budget 2026 raises the Income Tax trading allowance from £1,000 to £3,000 from 6 April 2027:

The change is the new 2027-04-06: 3_000 value in gov.hmrc.income_tax.allowances.trading_allowance. trading_allowance_deduction already reads the parameter, so Class 4 NI and Income Tax follow. The allowance also covers miscellaneous income (ITTOIA s. 783B); the model applies it only to trading income, as before.

Tests

  • trading_allowance_deduction.yaml: the £1,000 cases move from 2027 to 2026, where £1,000 still applies. New 2027-28 cases cover full relief at £2,500 and £3,000, the cliff at £3,001 with receipts unknown, partial relief replacing £1,000 of expenses (with the Income Tax figure worked by hand), and expenses above £3,000.
  • test_trading_allowance_properties.py: ALLOWANCE is now £3,000 for 2027-28, and the boundary draws include £2,999.99, £3,000 and £3,000.01. The four properties (bounded relief, the statutory reference, no stacking on actual deductions, and monotone Income Tax) pass.
  • Every YAML file that mentions self-employment income or the allowance: 736 passed locally.

Invariants

Unchanged from the existing property tests, now at £3,000:

  • the relief is between 0 and min(allowance, profit);
  • taxable profit equals the ITTOIA Part 6A reference;
  • the allowance never stacks on actual deductions;
  • Income Tax doesn't fall when profit rises.

Impact

Not run yet (Budget-night reservation on the host). To follow on this PR from CI's aggregate impact.

Plan

  • Parameter, YAML tests, property test
  • CI green
  • Independent review
  • rulespec-uk parity issue

Reproducer: policyengine_uk/tests/policy/baseline/gov/hmrc/income_tax/allowances/trading_allowance_deduction.yaml

axiom: queued (rulespec-uk issue to follow; the provision is not yet legislated: Finance Bill 2026-27)

🤖 Generated with Claude Code

@MaxGhenis @claude
Raise the trading allowance to £3,000 from 6 April 2027
dea3882 
Budget 2026 paragraph 6.254 and the policy costings (page 23) raise the
Income Tax trading allowance from £1,000 to £3,000 from 6 April 2027,
to be legislated in Finance Bill 2026-27 (Table 6.1, item 15).

The £1,000 YAML cases move to 2026-27; new 2027-28 cases cover full
relief at £3,000, the cliff just above it, partial relief and expenses
above the allowance. The property test's allowance and boundary draws
move to £3,000.

Co-Authored-By: Claude Opus 5.5 <noreply@anthropic.com>
@juaristi22 juaristi22 mentioned this pull request Oct 28, 2026
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@MaxGhenis MaxGhenis mentioned this pull request Oct 28, 2026
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@MaxGhenis

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Consolidated into #2719 so the Budget 2026 measures go through the merge queue once. This commit is cherry-picked there unchanged.

@MaxGhenis MaxGhenis closed this Oct 28, 2026
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MaxGhenis deleted the ab26-trading-allowance branch October 28, 2026 15:19
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Aggregate impact on certified data: pass

Base a7f6bbee21 against head 0a5a7fa62f, both on enhanced_frs_2024_25.h5 (policyengine-uk-data 1.58.1, sha256 056e80fd8e91), fiscal years 2025-26 to 2031-32. Each year is a full microsimulation run on each side.

Checks: 0 broken by this change, 1 failing on both sides, 0 fixed. Moves flagged for review: 16 (thresholds in report_spec.yaml; a flag does not fail the job).

Workflow run and full report

Notes

  • In the years a figure from fewer than 10 records is suppressed (spending.disabled_students_allowance), every total containing it, and the decile incomes, are rebuilt from their other components, so no published total includes it. Those totals are marked †. A change is withheld where the two sides leave out different figures and can't be lined up.

Moves flagged for review

Measure Year Base Head Change
Decile 5: mean household_net_income per household 2027-28 £45,606 £45,746 +£140
Decile 4: mean household_net_income per household 2027-28 £41,873 £41,751 -£122
Decile 7: mean household_net_income per household 2031-32 £61,765 £61,918 +£153
Decile 6: mean household_net_income per household 2030-31 £53,174 £53,305 +£131
Decile 7: mean household_net_income per household 2030-31 £60,061 £59,925 -£136
Relative poverty, before housing costs: children 2031-32 23.1% 23.3% +0.21pp
Relative poverty, after housing costs: children 2027-28 30.8% 31.0% +0.21pp
Relative poverty, after housing costs: pensioners 2027-28 1,388k 1,401k +13.4k
Relative poverty, before housing costs: children 2031-32 3,516k 3,548k +31.9k
Decile 6: mean household_net_income per household 2031-32 £54,203 £54,286 +£83
Decile 4: mean household_net_income per household 2031-32 £44,167 £44,229 +£62
Relative poverty, after housing costs: children 2027-28 4,630k 4,661k +31.3k
Decile 8: mean household_net_income per household 2030-31 £75,540 £75,637 +£97
Decile 9: mean household_net_income per household 2030-31 £87,053 £86,944 -£109
Relative poverty, after housing costs: pensioners 2027-28 12.1% 12.2% +0.12pp
Decile 5: mean household_net_income per household 2031-32 £49,711 £49,655 -£56

Receipts by tax head

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Income tax 0 0 -£119.9m -£126.6m -£123.9m -£129.5m -£134.6m
Capital gains tax 0 0 -£19,052 -£17,068 -£16,859 -£15,182 -£13,357
VAT on private school fees 0 0 +£3.2m -£0.4m +£59,255 0 0

Spending by benefit and service

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Universal Credit 0 0 -£0.8m -£0.8m -£0.4m -£0.4m -£0.4m
Disabled Students' Allowance suppressed suppressed suppressed suppressed suppressed suppressed suppressed

Caseloads

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Disabled Students' Allowance suppressed suppressed suppressed suppressed suppressed suppressed suppressed

Government balance, each component counted once

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Government receipts, each component once 0 0 -£116.7m -£127.1m -£123.9m -£129.5m -£134.7m
Government spending 0 † 0 † -£0.8m † -£0.8m † -£0.4m † -£0.4m † -£0.4m †
Government balance, each receipt once 0 † 0 † -£116.0m † -£126.2m † -£123.5m † -£129.1m † -£134.3m †

Model totals

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
gov_tax 0 0 -£116.7m -£127.1m -£123.9m -£129.5m -£134.7m
household_tax 0 0 -£120.0m -£126.7m -£123.9m -£129.5m -£134.7m
pre_budget_change_household_tax 0 0 -£120.0m -£126.7m -£123.9m -£129.5m -£134.7m
gov_spending 0 † 0 † -£0.8m † -£0.8m † -£0.4m † -£0.4m † -£0.4m †
household_benefits 0 † 0 † -£0.8m † -£0.8m † -£0.4m † -£0.4m † -£0.4m †
gov_balance 0 † 0 † -£116.0m † -£126.2m † -£123.5m † -£129.1m † -£134.3m †

Household income totals

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Household net income 0 † 0 † +£119.2m † +£125.8m † +£123.6m † +£129.1m † +£134.3m †
Household net income (HBAI definition) 0 0 +£119.2m +£125.8m +£123.5m +£129.1m +£134.2m

Poverty rates

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Absolute poverty, after housing costs: everyone 0 0 -0.00pp -0.00pp -0.01pp -0.01pp -0.01pp
Absolute poverty, after housing costs: children 0 0 0 0 -0.03pp -0.03pp -0.03pp
Absolute poverty, after housing costs: working-age adults 0 0 -0.00pp 0 -0.00pp -0.00pp -0.00pp
Absolute poverty, after housing costs: pensioners 0 0 -0.01pp -0.01pp -0.01pp -0.00pp -0.00pp
Relative poverty, before housing costs: everyone 0 0 0 0 0 0 +0.08pp
Relative poverty, before housing costs: children 0 0 0 0 0 0 +0.21pp
Relative poverty, before housing costs: working-age adults 0 0 0 0 0 0 +0.05pp
Relative poverty, before housing costs: pensioners 0 0 0 0 0 0 +0.00pp
Relative poverty, after housing costs: everyone 0 0 +0.09pp -0.00pp -0.00pp -0.00pp -0.00pp
Relative poverty, after housing costs: children 0 0 +0.21pp -0.00pp -0.00pp 0 0
Relative poverty, after housing costs: working-age adults 0 0 +0.05pp -0.00pp -0.00pp 0 0
Relative poverty, after housing costs: pensioners 0 0 +0.12pp -0.01pp -0.01pp -0.01pp -0.00pp

People in poverty

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Absolute poverty, after housing costs: everyone 0 0 -1.8k -707 -6.6k -6.2k -6.3k
Absolute poverty, after housing costs: children 0 0 0 0 -4.0k -4.0k -4.0k
Absolute poverty, after housing costs: working-age adults 0 0 -1.1k 0 -2.0k -2.0k -2.0k
Absolute poverty, after housing costs: pensioners 0 0 -705 -707 -709 -298 -298
Relative poverty, before housing costs: everyone 0 0 0 0 0 0 +53.7k
Relative poverty, before housing costs: children 0 0 0 0 0 0 +31.9k
Relative poverty, before housing costs: working-age adults 0 0 0 0 0 0 +21.4k
Relative poverty, before housing costs: pensioners 0 0 0 0 0 0 +425
Relative poverty, after housing costs: everyone 0 0 +65.4k -778 -823 -712 -298
Relative poverty, after housing costs: children 0 0 +31.3k -35 -76 0 0
Relative poverty, after housing costs: working-age adults 0 0 +20.6k -35 -38 0 0
Relative poverty, after housing costs: pensioners 0 0 +13.4k -707 -709 -712 -298

Inequality

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Gini coefficient, equivalised HBAI income before housing costs 0 0 -0.0000 -0.0000 -0.0000 -0.0000 -0.0000

Mean household net income in each side's own deciles

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Decile 1: mean household_net_income per household 0 † 0 † -£0.09 † -£0.08 † -£0.07 † -£0.27 † -£2.66 †
Decile 2: mean household_net_income per household 0 † 0 † +£0.06 † +£0.09 † +£0.15 † +£0.16 † +£0.73 †
Decile 3: mean household_net_income per household 0 † 0 † +£1.39 † -£0.66 † -£1.82 † -£14 † -£5.80 †
Decile 4: mean household_net_income per household 0 † 0 † -£122 † +£29 † +£3.62 † +£27 † +£62 †
Decile 5: mean household_net_income per household 0 † 0 † +£140 † -£32 † +£4.96 † +£3.39 † -£56 †
Decile 6: mean household_net_income per household 0 † 0 † +£8.52 † +£8.87 † +£9.12 † +£131 † +£83 †
Decile 7: mean household_net_income per household 0 † 0 † +£4.60 † +£5.81 † +£4.58 † -£136 † +£153 †
Decile 8: mean household_net_income per household 0 † 0 † +£6.16 † +£46 † +£5.22 † +£97 † -£58 †
Decile 9: mean household_net_income per household 0 † 0 † +£2.71 † -£36 † +£1.35 † -£109 † +£6.82 †
Decile 10: mean household_net_income per household 0 † 0 † +£5.70 † -£31 † -£32 † -£32 † +£18 †

Standard reform costings (change in gov_balance)

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Raise basic rate by 1pp 0 0 -£7.7m -£4.2m -£4.4m -£4.4m -£4.6m
Raise higher rate by 1pp 0 0 -£4.2m -£0.7m +£2.6m -£57.3m -£1.0m
Raise personal allowance by ~800GBP/year 0 0 +£1.3m +£4.7m +£0.6m +£1.4m +£0.1m
Raise child benefit by 25GBP/week per additional child 0 0 +£81,585 +£4.3m +£0 0 -£0
Reduce Universal Credit taper rate to 20% 0 0 +£0.8m +£1.2m +£1.2m +£1.3m +£1.2m
Raise Class 1 main employee NICs rate to 10% 0 0 -£3.2m +£0.4m -£19.0m -£19.1m +£37
Raise VAT standard rate by 2pp 0 0 +£0.3m -£41,318 +£5,692 +£164 +£228
Raise additional rate by 3pp 0 0 -£3.4m -£0.1m -£0.1m suppressed suppressed
Raise the Universal Credit standard allowance by 10% 0 0 -£0 +£0.5m -£18.6m -£18.6m +£0
Raise the State Pension by 10% 0 0 -£2.1m +£1.0m +£0.4m -£3.2m -£63.8m

Standard reforms: change in each reform's target

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Raise basic rate by 1pp: change in income_tax 0 0 -£4.5m -£4.6m -£4.4m -£4.5m -£4.6m
Raise higher rate by 1pp: change in income_tax 0 0 -£1.1m -£1.2m -£1.2m -£1.2m -£1.0m
Raise personal allowance by ~800GBP/year: change in income_tax 0 0 +£0.9m +£1.0m +£0.6m +£1.4m +£0.1m
Reduce Universal Credit taper rate to 20%: change in universal_credit 0 0 -£0.7m -£0.8m -£1.2m -£1.3m -£1.2m
Raise additional rate by 3pp: change in income_tax 0 0 -£0.1m -£0.1m -£0.1m suppressed suppressed
Raise the Universal Credit standard allowance by 10%: change in universal_credit 0 0 -£0 0 -£0.9m -£1.4m -£2

Household net income by decile

Mean change in household net income per household, and as a share of the decile's base income; households stay in the base run's deciles.

Base decile 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Decile 1 0 0 0 0 0 0 0
Decile 2 0 0 +£1 (+0.0%) fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change
Decile 3 0 0 +£1 (+0.0%) +£1 (+0.0%) +£1 (+0.0%) +£2 (+0.0%) +£2 (+0.0%)
Decile 4 0 0 +£6 (+0.0%) +£6 (+0.0%) +£3 (+0.0%) +£3 (+0.0%) +£7 (+0.0%)
Decile 5 0 0 +£2 (+0.0%) +£2 (+0.0%) +£6 (+0.0%) +£6 (+0.0%) +£2 (+0.0%)
Decile 6 0 0 +£9 (+0.0%) +£9 (+0.0%) +£9 (+0.0%) +£9 (+0.0%) +£10 (+0.0%)
Decile 7 0 0 +£5 (+0.0%) +£6 (+0.0%) +£5 (+0.0%) +£5 (+0.0%) +£5 (+0.0%)
Decile 8 0 0 +£6 (+0.0%) +£6 (+0.0%) +£5 (+0.0%) +£6 (+0.0%) +£6 (+0.0%)
Decile 9 0 0 +£3 (+0.0%) +£4 (+0.0%) +£5 (+0.0%) +£5 (+0.0%) +£3 (+0.0%)
Decile 10 0 0 +£6 (+0.0%) +£5 (+0.0%) +£5 (+0.0%) +£5 (+0.0%) +£6 (+0.0%)
all 0 0 +£4 (+0.0%) +£4 (+0.0%) +£4 (+0.0%) +£4 (+0.0%) +£4 (+0.0%)
Year People gaining over £1 People losing over £1
2025-26 0.0% 0.0%
2026-27 0.0% 0.0%
2027-28 1.0% 0.0%
2028-29 1.0% 0.0%
2029-30 0.9% 0.0%
2030-31 0.9% 0.0%
2031-32 0.9% 0.0%

No change in any year: population.

Checks failing on both base and head (1)
  • VAT excluding private school fees is never negative (sign:vat): 2025-26: 76 units below zero, a weighted £-53,889,156 in total; 2026-27: 76 units below zero, a weighted £-55,420,387 in total; 2027-28: 76 units below zero, a weighted £-56,618,038 in total
Counted-once check

Each of 91 components was raised by £1 per unit in 2026-27, and every head of its totals was read household by household: its own head must rise by exactly £1, no other tax head may move, no other benefit may rise, and the model's own total must move by what its heads moved. A head that breaks a rule is measured again twice: with every other head held at its baseline value, and with every other head held at its value after the first £1 while the component rises again. It fails where either still shows the response. 0 failed; 0 were skipped.

  • widowed_parents_allowance: pension_credit responds only through other heads in fewer than 10 households (other heads that moved there: carers_allowance; gov_spending; not a failure)
  • widowed_parents_allowance: pension_credit responds only through other heads in fewer than 10 households (other heads that moved there: carers_allowance; household_benefits; not a failure)
Provenance
Side Commit Runtime Environment hash Partition hash Time
base main a7f6bbee21 uk 2.162.20 (files 097bc87ac2a7), core 3.33.12, py 3.13.18 aarch64 ac31395a7c9e 1eac2ca06b91 1889.63s
head #2713 merged into main 0a5a7fa62f uk 2.162.20 (files 6a6bb248a14d), core 3.33.12, py 3.13.18 aarch64 ac31395a7c9e 1eac2ca06b91 1864.62s

Dataset: hf://policyengine/policyengine-uk-data-private/enhanced_frs_2024_25.h5@2526edbbb687a3b54dbb11272e5389e4b62d2ac2, sha256 056e80fd8e9151d78f432a25cde863340baee81304c6216a37fb575ce8563784 (verified on both sides), policyengine-uk-data 1.58.1.

Receipts by tax head: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Final charge on cash interest in non-cash ISAs £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Lifetime ISA withdrawal charge £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Income tax £298.70bn £318.31bn £335.48bn £350.39bn £365.67bn £383.40bn £400.90bn
National Insurance (employee and self-employed) £52.37bn £54.71bn £56.48bn £58.15bn £60.22bn £62.11bn £64.44bn
National Insurance (employer) £150.59bn £156.99bn £161.74bn £166.13bn £173.24bn £178.59bn £185.29bn
Employer NI change borne by capital £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Employer NI change borne by consumers £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Capital gains tax £12.61bn £13.05bn £13.53bn £14.02bn £14.52bn £15.05bn £15.58bn
Student loan repayments £7.91bn £8.21bn £8.43bn £8.63bn £8.85bn £9.10bn £9.42bn
VAT excluding private school fees £249.37bn £255.28bn £261.81bn £267.87bn £274.12bn £280.56bn £286.81bn
Change in VAT from its baseline £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
VAT on private school fees £1.95bn £2.00bn £2.05bn £2.10bn £2.21bn £2.21bn £2.31bn
Change in private school VAT from its baseline £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Fuel duties £24.53bn £24.64bn £26.64bn £26.69bn £26.42bn £25.76bn £26.35bn
Alcohol duties £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Tobacco duties £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Vehicle excise duties £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Betting and gaming duties £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
TV licence fee £4.26bn £4.41bn £4.42bn £4.44bn £4.45bn £4.47bn £4.48bn
Council tax £49.21bn £51.88bn £54.97bn £58.29bn £61.55bn £64.92bn £68.49bn
High value council tax surcharge £0.00bn £0.00bn £0.00bn £0.48bn £0.49bn £0.50bn £0.51bn
Northern Ireland domestic rates £0.55bn £0.58bn £0.60bn £0.63bn £0.66bn £0.69bn £0.72bn
Business rates £34.68bn £38.04bn £38.88bn £39.76bn £43.07bn £43.13bn £44.57bn
Stamp duty land tax on the household's own purchases £6.90bn £7.39bn £7.81bn £8.21bn £8.62bn £9.02bn £9.42bn
Stamp duty land tax paid by companies £4.81bn £5.98bn £6.73bn £7.46bn £8.21bn £8.87bn £9.16bn
Land transaction tax (Wales) £0.07bn £0.08bn £0.09bn £0.09bn £0.10bn £0.10bn £0.11bn
Land and buildings transaction tax (Scotland) £0.31bn £0.32bn £0.34bn £0.35bn £0.37bn £0.38bn £0.40bn
Unspecified tax change borne by capital £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Unspecified tax change borne by consumers £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Wealth tax £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Wealth tax excluding the main residence £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Land value tax £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Carbon tax £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Spending by benefit and service: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Lifetime ISA bonus £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
State Pension £121.64bn £126.07bn £127.08bn £128.87bn £132.52bn £136.31bn £140.08bn
Pension Credit £6.66bn £7.04bn £7.32bn £7.46bn £7.60bn £7.77bn £7.94bn
Winter Fuel Payment £1.86bn £1.86bn £1.80bn £1.78bn £1.79bn £1.79bn £1.80bn
Pension Age Winter Heating Payment (Scotland) £0.19bn £0.20bn £0.20bn £0.21bn £0.21bn £0.22bn £0.22bn
Universal Credit £75.21bn £80.38bn £82.93bn £84.23bn £85.57bn £86.87bn £87.97bn
Housing Benefit £8.55bn £8.89bn £9.17bn £9.31bn £9.58bn £9.84bn £10.10bn
Council Tax Reduction £2.07bn £2.18bn £2.32bn £2.46bn £2.60bn £2.74bn £2.89bn
Employment and Support Allowance (income-related) £0.79bn £0.81bn £0.83bn £0.85bn £0.86bn £0.89bn £0.90bn
Employment and Support Allowance (contribution-based) £5.20bn £5.34bn £5.46bn £5.59bn £5.72bn £5.85bn £5.99bn
Jobseeker's Allowance (income-based) £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Jobseeker's Allowance (contribution-based) £0.29bn £0.30bn £0.30bn £0.31bn £0.32bn £0.32bn £0.33bn
Income Support £0.11bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Working Tax Credit £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Child Tax Credit £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Incapacity Benefit £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Personal Independence Payment £26.94bn £28.06bn £29.13bn £29.83bn £30.54bn £31.26bn £31.96bn
Disability Living Allowance £7.49bn £7.80bn £8.10bn £8.29bn £8.49bn £8.69bn £8.88bn
Attendance Allowance £8.68bn £9.04bn £9.38bn £9.61bn £9.83bn £10.07bn £10.29bn
Carer's Allowance £4.48bn £4.67bn £4.84bn £4.96bn £5.08bn £5.19bn £5.31bn
Carer Support Payment (Scotland) £0.31bn £0.32bn £0.33bn £0.34bn £0.35bn £0.36bn £0.37bn
Carer's Allowance Supplement (Scotland) £0.00bn £0.04bn £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn
Severe Disablement Allowance £0.03bn £0.03bn £0.03bn £0.03bn £0.03bn £0.03bn £0.03bn
Industrial Injuries Disablement Benefit £0.50bn £0.52bn £0.53bn £0.54bn £0.55bn £0.57bn £0.58bn
Armed Forces Compensation Scheme £0.61bn £0.62bn £0.64bn £0.65bn £0.67bn £0.68bn £0.70bn
War Widow's or Widower's Pension £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Child Benefit £16.16bn £16.83bn £17.43bn £17.85bn £18.26bn £18.69bn £19.10bn
Scottish Child Payment £0.49bn £0.52bn £0.54bn £0.55bn £0.56bn £0.57bn £0.56bn
Two Child Limit Payment (Scotland, counterfactual) £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Healthy Start vouchers £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn
Maternity Allowance £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Statutory Maternity Pay £3.30bn £3.39bn £3.47bn £3.55bn £3.63bn £3.72bn £3.80bn
Statutory Paternity Pay £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Statutory Sick Pay £1.12bn £1.15bn £1.18bn £1.21bn £1.24bn £1.27bn £1.29bn
Sure Start Maternity Grant £0.01bn £0.01bn £0.01bn £0.01bn £0.01bn £0.01bn £0.01bn
Bereavement Support Payment £0.67bn £0.69bn £0.70bn £0.72bn £0.73bn £0.75bn £0.77bn
Widowed Parent's Allowance £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Tax-Free Childcare £0.55bn £0.56bn £0.57bn £0.58bn £0.59bn £0.61bn £0.59bn
Extended childcare entitlement £2.99bn £3.50bn £3.60bn £3.67bn £3.77bn £3.85bn £3.94bn
Universal childcare entitlement £2.05bn £2.23bn £2.28bn £2.34bn £2.40bn £2.47bn £2.52bn
Targeted childcare entitlement £0.50bn £0.51bn £0.52bn £0.53bn £0.54bn £0.56bn £0.52bn
Childcare Offer for Wales £0.26bn £0.28bn £0.28bn £0.29bn £0.30bn £0.30bn £0.31bn
Care to Learn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Childcare Grant £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Parents' Learning Allowance £0.20bn £0.20bn £0.20bn £0.20bn £0.20bn £0.20bn £0.20bn
Adult Dependants' Grant £0.06bn £0.06bn £0.04bn £0.04bn £0.04bn £0.04bn £0.04bn
Travel Grant £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Disabled Students' Allowance suppressed suppressed suppressed suppressed suppressed suppressed suppressed
16 to 19 Bursary Fund £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
NHS spending £203.83bn £204.54bn £205.13bn £205.79bn £206.49bn £207.23bn £207.73bn
State education spending £0.02bn £0.02bn £0.02bn £0.02bn £0.02bn £0.02bn £0.02bn
Transport subsidy spending £25.05bn £25.13bn £25.21bn £25.29bn £25.37bn £25.46bn £25.53bn
Cost-of-living support payment £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Energy Bills Rebate £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Energy Price Guarantee subsidy £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Basic income £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Disability basic income £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Other public spending budget change £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Caseloads: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Lifetime ISA bonus 0k 0k 0k 0k 0k 0k 0k
State Pension 11,261k 11,158k 10,849k 10,746k 10,783k 10,822k 10,848k
Pension Credit 1,485k 1,483k 1,480k 1,461k 1,462k 1,464k 1,460k
Winter Fuel Payment 7,842k 7,793k 7,494k 7,407k 7,432k 7,459k 7,477k
Pension Age Winter Heating Payment (Scotland) 803k 803k 803k 800k 803k 806k 808k
Universal Credit 6,334k 6,341k 6,366k 6,347k 6,345k 6,333k 6,298k
Housing Benefit 1,249k 1,247k 1,250k 1,234k 1,238k 1,240k 1,239k
Council Tax Reduction 3,175k 3,198k 3,209k 3,229k 3,244k 3,257k 3,264k
Employment and Support Allowance (income-related) 71k 71k 71k 71k 71k 72k 72k
Employment and Support Allowance (contribution-based) 719k 721k 723k 726k 728k 731k 732k
Jobseeker's Allowance (income-based) 0k 0k 0k 0k 0k 0k 0k
Jobseeker's Allowance (contribution-based) 67k 67k 67k 68k 68k 68k 68k
Income Support 25k 0k 0k 0k 0k 0k 0k
Working Tax Credit 0k 0k 0k 0k 0k 0k 0k
Child Tax Credit 0k 0k 0k 0k 0k 0k 0k
Incapacity Benefit 0k 0k 0k 0k 0k 0k 0k
Personal Independence Payment 3,566k 3,579k 3,589k 3,601k 3,613k 3,626k 3,635k
Disability Living Allowance 1,291k 1,295k 1,299k 1,303k 1,308k 1,312k 1,316k
Attendance Allowance 1,694k 1,700k 1,705k 1,711k 1,716k 1,723k 1,727k
Carer's Allowance 1,034k 1,038k 1,041k 1,044k 1,048k 1,051k 1,053k
Carer Support Payment (Scotland) 71k 71k 72k 72k 72k 72k 73k
Carer's Allowance Supplement (Scotland) 0k 71k 72k 72k 72k 72k 73k
Severe Disablement Allowance 4k 4k 4k 4k 4k 4k 4k
Industrial Injuries Disablement Benefit 137k 137k 138k 138k 139k 139k 140k
Armed Forces Compensation Scheme 93k 93k 94k 94k 94k 95k 95k
War Widow's or Widower's Pension 0k 0k 0k 0k 0k 0k 0k
Child Benefit 8,102k 8,128k 8,142k 8,165k 8,191k 8,216k 8,232k
Scottish Child Payment 350k 352k 353k 357k 354k 355k 342k
Two Child Limit Payment (Scotland, counterfactual) 0k 0k 0k 0k 0k 0k 0k
Healthy Start vouchers 199k 200k 201k 201k 202k 203k 203k
Maternity Allowance 0k 0k 0k 0k 0k 0k 0k
Statutory Maternity Pay 332k 334k 335k 336k 337k 338k 339k
Statutory Paternity Pay 0k 0k 0k 0k 0k 0k 0k
Statutory Sick Pay 181k 182k 182k 183k 183k 184k 185k
Sure Start Maternity Grant 26k 26k 26k 26k 26k 27k 27k
Bereavement Support Payment 98k 98k 98k 99k 99k 99k 100k
Widowed Parent's Allowance 0k 0k 0k 0k 0k 0k 0k
Tax-Free Childcare 1,014k 1,024k 1,024k 1,027k 1,027k 1,031k 1,013k
Extended childcare entitlement 796k 801k 806k 809k 815k 819k 820k
Universal childcare entitlement 1,071k 1,074k 1,077k 1,080k 1,086k 1,096k 1,097k
Targeted childcare entitlement 165k 156k 154k 155k 155k 156k 144k
Childcare Offer for Wales 39k 39k 39k 39k 39k 39k 39k
Care to Learn 0k 0k 0k 0k 0k 0k 0k
Childcare Grant 0k 0k 0k 0k 0k 0k 0k
Parents' Learning Allowance 98k 98k 99k 99k 99k 100k 100k
Adult Dependants' Grant 18k 18k 12k 12k 12k 13k 13k
Travel Grant 0k 0k 0k 0k 0k 0k 0k
Disabled Students' Allowance suppressed suppressed suppressed suppressed suppressed suppressed suppressed
16 to 19 Bursary Fund 0k 0k 0k 0k 0k 0k 0k
Cost-of-living support payment 0k 0k 0k 0k 0k 0k 0k
Energy Bills Rebate 0k 0k 0k 0k 0k 0k 0k
Energy Price Guarantee subsidy 0k 0k 0k 0k 0k 0k 0k
Basic income 0k 0k 0k 0k 0k 0k 0k
Disability basic income 0k 0k 0k 0k 0k 0k 0k
Government balance, each component counted once: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Government receipts, each component once £898.82bn £941.86bn £979.99bn £1,013.71bn £1,052.77bn £1,088.88bn £1,128.96bn
Government spending £528.95bn † £543.83bn † £551.68bn † £558.06bn † £566.57bn † £575.31bn † £583.38bn †
Government balance, each receipt once £369.87bn † £398.03bn † £428.31bn † £455.65bn † £486.20bn † £513.57bn † £545.58bn †
Benefits in household_benefits but not in gov_spending £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Model totals: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
gov_tax £898.82bn £941.86bn £979.99bn £1,013.71bn £1,052.77bn £1,088.88bn £1,128.96bn
household_tax £496.91bn £527.60bn £554.39bn £577.61bn £603.20bn £627.52bn £654.55bn
pre_budget_change_household_tax £489.00bn £519.39bn £545.96bn £568.50bn £593.85bn £617.92bn £644.61bn
gov_spending £528.95bn † £543.83bn † £551.68bn † £558.06bn † £566.57bn † £575.31bn † £583.38bn †
household_benefits £528.95bn † £543.83bn † £551.68bn † £558.06bn † £566.57bn † £575.31bn † £583.38bn †
gov_balance £369.87bn † £398.03bn † £428.31bn † £455.65bn † £486.20bn † £513.57bn † £545.58bn †
Household income totals: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Household market income £1,651.49bn £1,713.03bn £1,764.05bn £1,812.97bn £1,862.19bn £1,918.39bn £1,985.28bn
Household net income £1,644.42bn † £1,688.69bn † £1,719.67bn † £1,750.74bn † £1,781.80bn † £1,821.20bn † £1,867.53bn †
Household net income (HBAI definition) £1,457.29bn £1,504.48bn £1,537.70bn £1,569.48bn £1,602.79bn £1,640.62bn £1,687.18bn
Population: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
People 69,224k 69,466k 69,668k 69,891k 70,128k 70,381k 70,550k
Benefit units 35,100k 35,223k 35,325k 35,438k 35,558k 35,686k 35,772k
Households 31,037k 31,145k 31,236k 31,336k 31,442k 31,555k 31,631k
Poverty rates: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Absolute poverty, before housing costs: everyone 16.0% 15.1% 15.4% 15.5% 15.6% 15.7% 15.7%
Absolute poverty, before housing costs: children 24.0% 21.1% 21.3% 21.3% 21.5% 21.8% 21.8%
Absolute poverty, before housing costs: working-age adults 13.8% 13.5% 13.9% 14.1% 14.1% 14.2% 14.2%
Absolute poverty, before housing costs: pensioners 13.7% 13.2% 13.1% 13.4% 13.5% 13.5% 13.5%
Absolute poverty, after housing costs: everyone 21.4% 20.8% 21.3% 21.5% 21.7% 21.9% 22.2%
Absolute poverty, after housing costs: children 33.0% 30.7% 31.1% 31.1% 31.4% 31.7% 32.2%
Absolute poverty, after housing costs: working-age adults 19.8% 19.6% 20.2% 20.5% 20.7% 20.8% 21.0%
Absolute poverty, after housing costs: pensioners 12.7% 12.4% 12.3% 12.5% 12.8% 12.9% 13.0%
Relative poverty, before housing costs: everyone 17.2% 16.4% 16.5% 16.4% 16.2% 16.3% 16.6%
Relative poverty, before housing costs: children 26.2% 23.5% 23.4% 23.1% 22.6% 22.8% 23.3%
Relative poverty, before housing costs: working-age adults 14.6% 14.4% 14.7% 14.7% 14.6% 14.7% 14.9%
Relative poverty, before housing costs: pensioners 15.0% 14.8% 14.1% 14.1% 14.0% 14.0% 14.2%
Relative poverty, after housing costs: everyone 21.6% 21.0% 21.2% 21.2% 21.3% 21.4% 21.8%
Relative poverty, after housing costs: children 33.3% 31.2% 31.0% 30.7% 31.0% 31.0% 31.5%
Relative poverty, after housing costs: working-age adults 19.9% 19.8% 20.1% 20.3% 20.4% 20.5% 20.7%
Relative poverty, after housing costs: pensioners 12.9% 12.5% 12.2% 11.9% 11.8% 11.9% 12.8%
People in poverty: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Absolute poverty, before housing costs: everyone 11,057k 10,466k 10,734k 10,860k 10,960k 11,054k 11,081k
Absolute poverty, before housing costs: children 3,580k 3,171k 3,210k 3,220k 3,261k 3,305k 3,317k
Absolute poverty, before housing costs: working-age adults 5,853k 5,746k 6,021k 6,123k 6,169k 6,209k 6,219k
Absolute poverty, before housing costs: pensioners 1,625k 1,550k 1,504k 1,517k 1,530k 1,539k 1,545k
Absolute poverty, after housing costs: everyone 14,847k 14,422k 14,806k 14,993k 15,235k 15,396k 15,631k
Absolute poverty, after housing costs: children 4,937k 4,609k 4,671k 4,685k 4,753k 4,810k 4,908k
Absolute poverty, after housing costs: working-age adults 8,406k 8,359k 8,731k 8,898k 9,022k 9,112k 9,238k
Absolute poverty, after housing costs: pensioners 1,504k 1,454k 1,403k 1,410k 1,460k 1,474k 1,486k
Relative poverty, before housing costs: everyone 11,896k 11,403k 11,468k 11,487k 11,373k 11,468k 11,706k
Relative poverty, before housing costs: children 3,918k 3,523k 3,519k 3,491k 3,419k 3,458k 3,548k
Relative poverty, before housing costs: working-age adults 6,202k 6,136k 6,338k 6,400k 6,366k 6,415k 6,536k
Relative poverty, before housing costs: pensioners 1,776k 1,744k 1,611k 1,597k 1,588k 1,595k 1,621k
Relative poverty, after housing costs: everyone 14,957k 14,597k 14,763k 14,824k 14,951k 15,041k 15,351k
Relative poverty, after housing costs: children 4,976k 4,677k 4,661k 4,634k 4,690k 4,712k 4,794k
Relative poverty, after housing costs: working-age adults 8,443k 8,455k 8,701k 8,846k 8,916k 8,977k 9,092k
Relative poverty, after housing costs: pensioners 1,537k 1,465k 1,401k 1,344k 1,345k 1,353k 1,464k
Inequality: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Gini coefficient, equivalised HBAI income before housing costs 0.3085 0.3059 0.3065 0.3071 0.3075 0.3081 0.3094
Mean household net income in each side's own deciles: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Decile 1: mean household_net_income per household £17,781 † £17,906 † £17,832 † £17,905 † £18,142 † £18,339 † £18,480 †
Decile 2: mean household_net_income per household £27,962 † £28,917 † £28,655 † £28,906 † £29,096 † £29,647 † £30,236 †
Decile 3: mean household_net_income per household £34,380 † £35,463 † £36,066 † £36,509 † £36,848 † £37,324 † £38,037 †
Decile 4: mean household_net_income per household £38,785 † £40,713 † £41,751 † £42,442 † £43,149 † £43,933 † £44,229 †
Decile 5: mean household_net_income per household £43,788 † £44,626 † £45,746 † £46,257 † £47,333 † £48,289 † £49,655 †
Decile 6: mean household_net_income per household £48,210 † £49,525 † £50,745 † £51,922 † £52,212 † £53,305 † £54,286 †
Decile 7: mean household_net_income per household £56,218 † £57,224 † £57,769 † £58,016 † £59,045 † £59,925 † £61,918 †
Decile 8: mean household_net_income per household £69,150 † £70,533 † £71,806 † £73,121 † £74,098 † £75,637 † £77,369 †
Decile 9: mean household_net_income per household £79,490 † £81,421 † £82,830 † £84,100 † £85,540 † £86,944 † £89,951 †
Decile 10: mean household_net_income per household £117,581 † £120,296 † £121,939 † £124,132 † £126,013 † £128,310 † £131,128 †
Standard reform costings (change in gov_balance): head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Raise basic rate by 1pp £6.47bn £6.76bn £6.66bn £6.85bn £7.06bn £7.34bn £7.54bn
Raise higher rate by 1pp £3.69bn £3.98bn £4.03bn £4.29bn £4.46bn £4.73bn £4.91bn
Raise personal allowance by ~800GBP/year £-3.82bn £-3.94bn £-4.01bn £-4.08bn £-4.18bn £-4.18bn £-2.00bn
Raise child benefit by 25GBP/week per additional child £-1.99bn £-1.75bn £-1.56bn £-1.45bn £-1.35bn £-1.23bn £-1.12bn
Reduce Universal Credit taper rate to 20% £-20.39bn £-20.96bn £-21.38bn £-21.61bn £-21.87bn £-22.17bn £-22.60bn
Raise Class 1 main employee NICs rate to 10% £11.02bn £11.42bn £11.77bn £12.07bn £12.35bn £12.73bn £13.07bn
Raise VAT standard rate by 2pp £24.89bn £25.55bn £26.14bn £26.75bn £27.39bn £28.03bn £28.66bn
Raise additional rate by 3pp £2.96bn £3.21bn £3.26bn £3.46bn £3.65bn suppressed suppressed
Raise the Universal Credit standard allowance by 10% £-3.05bn £-3.18bn £-3.30bn £-3.34bn £-3.40bn £-3.44bn £-3.48bn
Raise the State Pension by 10% £-7.79bn £-8.02bn £-8.01bn £-8.12bn £-8.43bn £-8.55bn £-8.93bn
Standard reforms: change in each reform's target: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Raise basic rate by 1pp: change in income_tax £6.61bn £6.91bn £6.83bn £7.03bn £7.23bn £7.46bn £7.72bn
Raise higher rate by 1pp: change in income_tax £3.69bn £3.99bn £4.04bn £4.25bn £4.47bn £4.74bn £4.93bn
Raise personal allowance by ~800GBP/year: change in income_tax £-3.95bn £-4.08bn £-4.17bn £-4.24bn £-4.34bn £-4.41bn £-1.76bn
Raise child benefit by 25GBP/week per additional child: change in child_benefit £2.33bn £2.14bn £1.95bn £1.84bn £1.73bn £1.62bn £1.50bn
Reduce Universal Credit taper rate to 20%: change in universal_credit £20.39bn £20.95bn £21.37bn £21.62bn £21.87bn £22.22bn £22.61bn
Raise Class 1 main employee NICs rate to 10%: change in national_insurance £11.28bn £11.74bn £12.06bn £12.37bn £12.69bn £13.03bn £13.49bn
Raise VAT standard rate by 2pp: change in vat £24.69bn £25.35bn £25.94bn £26.54bn £27.17bn £27.81bn £28.43bn
Raise additional rate by 3pp: change in income_tax £2.96bn £3.21bn £3.26bn £3.46bn £3.66bn suppressed suppressed
Raise the Universal Credit standard allowance by 10%: change in universal_credit £3.05bn £3.18bn £3.29bn £3.36bn £3.42bn £3.47bn £3.52bn
Raise the State Pension by 10%: change in state_pension £10.68bn £11.18bn £11.31bn £11.55bn £12.00bn £12.44bn £12.94bn

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