Overall, the Budget delivered few surprises, but several announcements will have a direct impact on investors and advisers – particularly those focused on tax-efficient strategies and supporting UK growth businesses.

EIS and VCT Expansion

One of the standout measures is the expansion of the Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCTs), allowing knowledge-intensive companies to raise up to £40 million under these schemes. This is one of the few genuine growth initiatives announced, providing innovative businesses with greater backing to scale and succeed.

However, the Budget also introduced a notable change: income tax relief on VCTs will decrease from 30% to 20%. This move is significant and arguably makes EIS even more attractive, as it retains its 30% income tax relief as well as the other powerful associated reliefs including CGT deferral relief, CGT free growth, Business Relief qualification providing inheritance tax mitigation, and share loss relief.

Business Relief

On the Business Relief (BR) front, the refinement of last year’s announcement of a £1 million personal allowance, now allowing interspousal transfer, is a practical and overdue fix. This change, effective from April 2026, will make estate planning fairer and more efficient for investors, business owners and their families.

Renewable Obligations

The Chancellor announced that the 75% of support for the Renewables Obligation (“RO”), being the initiative that provides subsidies to renewable energy assets, currently derived from billpayers, will end, to be replaced by government support. This shift of RO support from electricity bills to general taxation leaves the risk of ROCs being curtailed ahead of the scheduled subsidy period end in 2037.

This move is not entirely unexpected. Ofgem is already consulting on a change in RO indexation from RPI to CPI, with the consultation closing imminently and implementation anticipated from April 2026. At Deepbridge, our financial and valuation models for the Deepbridge Estate Planning Service assume no indexation from 1 April 2027, so this change will have minimal impact on our forecast wind asset values. Nonetheless, these developments underline the importance of careful planning and robust modelling in the renewables sector, with investors looking at renewables needing to understand how managers value underlying assets.

A Political Budget, Not an Economic One

Beyond these measures, the Budget was predominantly political rather than economic. There were no notable policies aimed at reducing unemployment or boosting business confidence. The tax burden is set to rise to record levels over the coming years, driven by fiscal drag and targeted levies. Against this backdrop, tax-efficient investments such as EIS and Business Relief have never been more important. These aren’t just tax strategies, they are growth strategies for the UK economy. Financial advisers and investors should act now to take advantage of these opportunities.

Andrew Aldridge, Chief Operating Officer, Deepbridge Capital