Chancellor John Healey has delivered his 2026 Budget. Here are the measures of relevance to the creative industries.

Creative industries mentions

The creative industries were not specifically mentioned in the chancellor’s speech but there were some references in the full Budget document.

The document described the creative industries as a “growth-driving” sector:

“The UK must look forward and champion our growth-driving sectors and the places that host them, from advanced manufacturing, defence, digital and technology, and clean energy to life sciences, creative industries and financial and professional business services, and the critical foundational industries that underpin our economic resilience.”

There was some funding announcing for creative initiatives. While not in Bristol and the wider region, they could be relevant if you do work in those areas:

• Over £75 million for the CoSTAR network of labs in Yorkshire, Dundee, Belfast, Buckinghamshire and Surrey.
• £20 million from the Growth Mission Fund to support the restoration and redevelopment of the Littlewoods site in Liverpool into a 260,000 square foot creative campus for film, TV, gaming, immersive technology, and digital screen industries.

Funding for West of England

The government is providing £285 million of capital grant funding through the Good Growth Funds in 2027/2028 to invest in areas such as infrastructure, regeneration, skills, housing, and innovation. The West of England will receive £14.49 million.

From 2028, the West of England will get access to a new £1.5 billion strategic borrowing programme being designed with and for mayors.

The government is providing £10 million to unlock private investment in Bristol Temple Quarter.

Measures relevant to people running running creative businesses

These measures aren’t specific to the creative businesses but are relevant to the people running them.

Founders’ relief

A new founders’ relief will be introduced on 6 April 2027 that will provide a 10% capital gains tax rate for up to £10 million of lifetime gains.

The technical consultation for the relief shows that it has a narrow focus and the government estimates it will benefit around 600 businesses.

Individuals must own 25% of the business, while the business must have a turnover of at least £10 million and a minimum of 15 full-time employees. It must also meet two out of three tests: 25% turnover growth, 25% headcount growth and qualifying expenditure of £1.5 million or more on research and development.

Business Asset Disposal Relief

From 1 April 2027, Business Asset Disposal Relief (BADR) for capital gains tax will be halved from £1 million to £500,000.

Business funding

The British Business Bank will receive an extra £2 billion is to back innovative and growing businesses. That includes £1.4 billion to invest in equity funds backing high-growth businesses, £165 million for community lenders, and £450 million for a new venture debt product providing non-dilutive finance to innovative firms.

Support for female entrepreneurs

The government will also launch a scale-up programme to support female founders.

British Business Bank funding for female-led businesses will double to £200 million.

National Living Wage and National Living Wage

National Living Wage and the National Minimum Wage rates will increase by 3.9% on 1 April 2027.

National Living Wage will rise to £13.21 an hour, while the National Minimum Wage for 18-20-year-olds will increase to £11.27 an hour and to £8.31 an hour for 16 to 17-year-olds and eligible apprentices.

Young entrepreneurs allowance

The government will set up a scheme which covers the living costs of young entrepreneurs during their first year of running a business.

Trading allowance

From 6 April 2027, the amount individuals can earn from self-employment tax free will increase from £1,000 to £3,000.

Support for scale-ups

The government has set up the new Scale UK service to highlight the support available for scaling businesses.

The new Scale UK Connect pilot offers 200 high-growth firms “expert advice, investor connections and international opportunities”.

Eligible businesses need to have an annual turnover and/or investment of at least £2 million and employ at least 10 people, including the founder/s.

Simplifying research and development tax relief

The government will simplify the process for applying for R&D tax relief by removing the need for companies to notify HMRC in advance of making a claim from April 2027. There will also be a simpler additional information form from autumn 2027.

Tackling business red tape

The government said it is reducing costs for businesses by £800 million, including accepting 14 of the 15 recommendations of the Small Business Regulation Taskforce aimed at reducing regulatory burdens on small businesses:

• Creating a ‘Tell Government Once’ philosophy

• Reducing the burden of ONS surveys on SMEs

• Standardising construction procurement

• Supporting SMEs in complying with Natasha’s Law

• Creating a better business journey through GOV.UK

• Instilling SME Priorities into a strengthened growth framework

• Establishing a single business identifier

• Dedicated portal for reporting burdensome regulation

• Delivering regulatory advice through Growth Hubs

• Supporting directors’ understanding of core responsibilities

• Cutting the administrative burden on SMEs via tax/HMRC systems

• Strengthening transparency of net administrative burdens

• Building regulation with smaller businesses in mind

• Digitising and standardising license applications

Enterprise Management Incentives (EMI)

The government is rebranding the Company Share Option Plan (CSOP) as Enterprise Management Incentives 2 (EMI2), with the individual share option limit will increase from £60,000 to £120,000 from April 2027.

The current £250,000 combined limit for EMI and CSOP options will be removed, which means eligible employees can hold £250,000 of EMI options and up to £120,000 of EMI2.

Tax-free driving mileage rates

The temporary 55p per mile tax-free rate for those driving up to 10,000 miles for work has been made permanent, and the rate for above 10,000 miles has increased from 25p to 35p.

Self assessment

From April 2029, self assessment taxpayers who make tax payments on account will “make smaller, more regular contributions towards their tax bill throughout the year, bringing payment closer to when income is earned”.

Tax avoidance and unpaid tax

Among the measures to tackle the non-payment of tax are:

• HMRC will receive a new power to directly recover from bank accounts “lower-value tax debts from those who can afford to pay but repeatedly fail to do so”.
• Employers required from April 2029 to set up a Direct Debit with HMRC for their PAYE and VAT return payments, although the flexibility to pay by other methods will be retained.

High streets

A new high streets strategy has been published. It includes the following funding:

• Derelict Buildings Fund: £125 million for 60 local authorities to repurpose eyesore vacant units and restore civic pride.
• Regional Cooperative Development Programme: A £10 million programme for strategic authorities to support local cooperatives.
• High street rental auctions: A £10 million programme supporting local authorities to scale delivery of high street rental auctions, which allows local authorities to force landlords to rent out persistently vacant commercial premises.
• Community ownership funding: £65 million more funding to support communities to take over buildings.

Fuel duty

The 5p cut in fuel duty extended to July 2027.

Parental pay

From April 2029, parental pay will be extended to more than 150,000 additional parents per year, including self-employed fathers and partners who have previously missed out.

About Bristol Creative Industries

Bristol Creative Industries is the membership network that supports the region's creative sector to learn, grow and connect, driven by the common belief that we can achieve more collectively than alone.