Taxes on UK rental income
The property income tax increase is among the changes most relevant to UAE-based Britons who rent out homes in the UK.
From April 6, 2027, property income tax rates will be 24% at the basic rate, 44% at the higher rate and 49% at the additional rate in England, Wales and Northern Ireland. This represents a further two-percentage-point rise on the rates previously announced for that date. www.gov.uk
Living abroad does not remove UK tax obligations on income from letting UK property. Landlords may receive rent with tax already deducted or, with HM Revenue and Customs’ approval, receive it in full and pay through Self Assessment. www.gov.uk
For expat owners, the increase means reviewing how much rental income remains after tax and whether it still meets their spending, mortgage or retirement needs.
“However, the further two-percentage-point increase in savings and property income tax from April 2027 deserves attention, particularly for those receiving UK rental income,” Smith said.
Tax-free savings stay
Healey’s decision to retain the £20,000 annual cash ISA allowance preserves a tax-free savings option for eligible UK residents.
For British expats, the key distinction is residence. Holding a British passport does not, by itself, allow someone living overseas to contribute.
People who become non-UK resident can generally keep existing ISAs and retain UK tax relief on the money and investments already held. They usually cannot add money while non-resident, although exceptions apply to Crown employees working overseas and their spouses or civil partners.
They can contribute again when they return and become UK resident, subject to the annual allowance. www.gov.uk
“Retaining the £20,000 annual cash ISA allowance, rather than proceeding with the planned reduction, is also relevant for those considering an eventual return, when they can generally resume contributions once UK resident again,” Smith said.
Help with household bills
For households in Britain, the Budget offers support with energy costs.
Up to 20 million households in council tax bands A to D in England will receive a one-off £100 Household Energy Payment in 2027, with funding for similar support elsewhere in the UK.
The government will also extend the temporary electricity VAT cut until July 1, 2027. A temporary increase in the surcharge on bank profits, from 3% to 6% for 15 months, will fund the measures.
It will ask energy regulator Ofgem to abolish gas standing charges and move those costs into unit prices. Removing the fixed daily fee will change how households pay, but will not automatically reduce every customer’s total bill.
Pressure on Britain’s high streets
The Budget also comes as retailers press for help with the cost of operating in Britain’s town centres.
More than one in 10 UK high-street shops stands vacant, according to Savills figures cited in the supplied Bloomberg report. Retailers face rising costs and changing shopping habits, while business leaders want broader reform of business rates, the tax on commercial premises.
Richard Walker, executive chairman of Iceland Foods, told Bloomberg Radio: “It has to be wholesale reform, not just tinkering around the edges of our business-rate taxation in the UK.”
For UAE-based Britons who own UK businesses, an earlier announcement also merits attention: pubs and social clubs in England are due to receive a 20% reduction in business rates from April 2027. The measure excludes restaurants, according to the report.
Burnham has separately announced a £210 million high-street revival package to redevelop derelict buildings and help prevent business closures. These measures form part of a wider regeneration programme, rather than changes to expats’ personal tax obligations.
Planning for a return
For many expats, managing money across borders will remain a long-term task.
Smith said St James’s Place’s Money on the Move 2026 research found that 78% of affluent and high-net-worth expats surveyed in the UAE planned to remain abroad for at least another eight years. The finding covers that surveyed group, rather than all British expats.
“For these families, managing finances across borders is a lasting part of life overseas,” he said.
“Their financial plans need to account for where they hold their savings, where they intend to retire and whether they might eventually return to the UK. Even when a Budget does not change those plans, it can affect how they prepare for them.”
Justin is a personal finance author and seasoned business journalist with over a decade of experience. He makes it his mission to break down complex financial topics and make them clear, relatable, and relevant—helping everyday readers navigate today’s economy with confidence.
Before returning to his Middle Eastern roots, where he was born and raised, Justin worked as a Business Correspondent at Reuters, reporting on equities and economic trends across both the Middle East and Asia-Pacific regions.
