The Autumn Budget is the government’s yearly update on tax and spending. It can affect the cost of running a courier van, how self-employed drivers report income and when they pay tax.
For couriers, the main changes in the 2026 Budget concern fuel, mileage claims and tax admin. Their impact depends on whether you’re self-employed, run a limited company or employ staff.
The 2026 Budget extends the temporary 5p-per-litre fuel duty cut to 1 July 2027 and delays the planned inflation-linked increase until then. This keeps the current duty reduction in place.
It doesn’t guarantee a 5p drop in pump prices, which also depend on wholesale prices, VAT and retailer costs. When pricing jobs or forecasting costs, allow for the scheduled duty change rather than assuming today’s pump price will hold.
One direct Autumn Budget 2026 change for owner-drivers is the mileage rate. The 55p-per-mile rate for the first 10,000 business miles is now permanent. From 6 April 2027, the rate for each business mile above 10,000 will rise from 25p to 35p.
These rates apply to employees using their own vehicles and to self-employed people who use simplified mileage expenses.
For a self-employed courier, mileage rates reduce taxable profit. They aren’t a payment from the government or an automatic reimbursement from a customer.
You can use simplified mileage expenses for a van, or claim eligible running costs using the actual-cost method. You can’t claim mileage and the same vehicle’s fuel, servicing and other running costs on top.
The right method depends on your van and how much you drive for work. Keep a log of business journeys as you go, including the date, route, purpose and miles.
Our guide to mileage records for couriers explains what to record.
There’s no rise to the headline rates of Income Tax, National Insurance or VAT in this Budget. But there are changes to allowances and tax payments that sole traders should understand.
From 6 April 2027, the Trading Allowance will rise from £1,000 to £3,000. It lets individuals receive up to that amount of qualifying trading and miscellaneous income tax-free.
It may help people starting a small business or earning occasional side income. A full-time courier with substantial van costs may get more value from claiming allowable expenses instead. You can’t claim the Trading Allowance and deduct expenses against the same income.
If you’re unsure which costs you can claim, read our guide to courier expenses. Tax treatment depends on whether you’re a sole trader or a limited company, and whether you use mileage rates or actual vehicle costs.
From April 2029, people who make Payments on Account (advance payments towards their Self Assessment bill) will move to smaller, more regular in-year payments. HMRC hasn’t decided how often the payments will be taken.
The change affects when you pay, not the total tax you owe. You’ll still need to file an annual return.
This could change how you manage cash flow. If you currently set money aside for January and July tax payments, watch for the final schedule and adjust your budget when HMRC confirms the details.
Making Tax Digital for Income Tax is already being introduced in stages. It applies to sole traders and landlords with qualifying income above £50,000 from April 2026, above £30,000 from April 2027 and above £20,000 from April 2028, subject to exemptions.
Qualifying income can include self-employment and property income.
If you need to join, you’ll use compatible software to keep digital records and send quarterly updates to HMRC. You’ll still submit an annual tax return and pay tax by the usual deadline.
The Budget gives people joining in April 2027 a penalty easement for their first four quarterly updates for 2027-28. They still need to send the updates.
Our guide to Making Tax Digital for couriers explains the staged start dates and how to prepare. Check your qualifying income and HMRC letters, then speak to an accountant if you’re unsure when the rules apply to you.
From 1 April 2029, VAT-registered businesses will need to issue and receive VAT invoices as e-invoices, unless an exemption applies. The government will publish more detail on the requirements before then. Read the e-invoicing implementation roadmap.
The National Living Wage will rise by 3.9% to £13.21 an hour from 1 April 2027. The National Minimum Wage rates for younger workers and eligible apprentices will also rise by 3.9%.
These increases affect couriers who employ staff. They don’t set the income a sole trader takes from their own business.
From 1 January 2027, the main-rate first-year allowance rises from 40% to 50% for qualifying spending on new and unused plant or machinery. This may include some depot or workshop equipment. The allowance can apply to companies and unincorporated businesses, subject to the rules.
A new van may qualify under traditional accounting. A second-hand van does not qualify for this specific allowance, although other tax relief may be available. Sole traders using cash-basis accounting generally claim van purchase costs as business expenses. The allowance reduces taxable profit; it does not mean a 50% cash saving on the purchase. Check your accounting method and eligibility before relying on it.
The Budget provides £100 million over two years to expand apprenticeship brokerage pilots to 14 Mayoral Strategic Authorities in England. This may help courier companies looking to recruit or train staff in participating areas, but the funding isn’t ring-fenced for the courier sector.
It also extends tariff suspensions on more than 250 goods and plans to remove the £135 customs duty relief on low-value imports by October 2028. These measures may affect customers importing goods and parcel flows, but they won’t change every courier’s costs directly.
Separate from the 2026 Budget’s tax changes, construction and traffic management continue along the A66. If you work around the route, check National Highways updates before setting off.
The Budget’s EV charging support is aimed at local, lower-powered public chargers. It may help drivers who rely on public charging, but it isn’t a general grant for courier vans.
The 2026 Budget changes don’t affect every courier in the same way. Start with your business setup and how you currently track income, costs and mileage.
The 2026 Budget gives couriers more certainty on mileage rates and keeps fuel duty support in place until July 2027. For many owner-drivers, the bigger task will be preparing for digital reporting and a different Self Assessment payment schedule.
For the full policy detail, read HMRC’s Budget 2026 documents.
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Not by itself. It keeps the temporary duty reduction in place until 1 July 2027, but retail fuel prices also depend on other costs.
No. You may need to keep digital records and send quarterly updates, but you’ll still submit an annual tax return and pay tax by the usual deadline.
The Budget doesn’t raise the headline rates of Income Tax or National Insurance. Your final bill still depends on your income, allowable expenses and tax position.
