The 2026 Autumn Budget included several announcements that could affect unpaid carers, from changes to Carer's Allowance to measures aimed at helping households with the cost of living.
Here's a summary of the key announcements:
Carer's Allowance 'cliff edge' to end
The Government plans to change how Carer's Allowance is reduced when someone earns more than the weekly earnings limit. Instead of losing your entire allowance if you earn just £1 over the limit, payments will gradually reduce by £1 for every £1 earned above the limit. The change is planned for 2030–31, so the current rules remain in place for now.
Help with energy bills and everyday costs
Several measures were announced to help households manage rising costs:
- Households in council tax bands A to D in England could receive a one-off £100 payment towards energy costs from January 2027. The property must be their main home, and further eligibility details are still to be confirmed.
- The temporary removal of VAT from household electricity bills will continue until July 2027. This is expected to save around £50 against the annual energy price cap in April 2027.
- Gas standing charges are due to be removed from gas bills by the end of 2027, with the costs instead included in the price paid for each unit of gas used. The impact on bills will depend on how much gas a household uses.
- A one-off debt relief scheme will be introduced for eligible vulnerable households with energy debt built up since the 2022–24 energy crisis. This will include some people receiving benefits or pensioners, subject to the scheme's final eligibility rules.
- The existing 5p-per-litre cut in fuel duty will be extended until July 2027.
Pension Tax Allowance
The new Pension Tax Allowance will be introduced in April 2027. The normal Personal Allowance (the amount someone can receive each year before paying income tax) is £12,570. As the State Pension increases, some pensioners may find their income goes slightly above this amount and they become liable to pay tax.
The new allowance is designed to help eligible pensioners avoid paying tax on this small amount above the threshold. Those with slightly higher incomes may also benefit from a reduced tax bill. The allowance will be applied automatically by HMRC.
Changes to disability benefits
The Government is reviewing Personal Independence Payment (PIP), with plans for the future of disability benefits expected to be set out in early 2027. No immediate changes to PIP eligibility or payment rates were announced in the Budget.
Any future changes may also be relevant to unpaid carers, as the disability benefits received by the person you support can affect your entitlement to Carer's Allowance.
Melanie Kendall, Project Lead at We Care You Care, says:
"While some of the Budget announcements are welcome news, and we were encouraged by the Prime Minister’s comments that he wants to see a social care system in which there is stronger support for unpaid carers, there is still more to do to recognise the contribution of unpaid carers and make sure they have the financial and practical support they need.”
If you care for a family member or friend and live in either Middlesbrough or Redcar & Cleveland, you can find out about local support on our website, Some useful pages include:
Taking time off from your caring role
Staying Warm this Winter – local help and support
