We now have a date for the Autumn Budget, and patience is required – it’s the latest in recent memory. The 26 November date leaves plenty of time for continued speculation about potential tax rises, freezes, and threshold changes, and for preparation too.
Reports vary, but the chancellor will likely need to find somewhere between £20 and £50 billion to meet her own fiscal rules and maintain the £9.9 billion buffer from her Spring Statement.
With only minimal headroom to begin with, U-turns on welfare cuts and the Winter Fuel Payment (among others) will need to be paid for.
Keep reading for a look at some of the announcements we might see, and why, regardless of what changes the Budget brings, patience, objectivity, and a focus on your long-term goals are key.
5 changes we might see in the chancellor’s Autumn Budget
1. The introduction of a “Wealth Tax”
Despite the rise in employer National Insurance (NI) in Rachel Reeves’ first budget, the chancellor will be keen not to break her party’s manifesto promise not to raise tax on working people. One way around this, and something many Labour backbenchers are calling for, would be to tax accumulated wealth, not income.
A so-called “Wealth Tax” might be politically divisive, but a recent report from MoneyAge suggests that it would have the support of 75% of UK adults.
The YouGov poll of 4,142 Brits suggested a 2% tax on assets exceeding £10 million. According to Sky News, this could raise around £11 billion a year for the Treasury. The survey found that:
- 49% “strongly” support its introduction
- 26% “somewhat” support it.
While a wealth tax might raise much-needed funds, it could also lead to a threatened “millionaire exodus”, which would be detrimental to growth. It might also take a long time to successfully implement, so the benefits wouldn’t be immediate.
2. Further Inheritance Tax changes
Another tax on accumulated assets, Inheritance Tax (IHT), has made plenty of headlines since Labour came into power. A change to Agricultural Property Relief saw high-profile protests from farmers. The decision to include pensions in a deceased’s estate for IHT calculation purposes also has its detractors.
But could further changes be on the way? A cap on the gifts you can make in your lifetime could prove controversial, as too any changes to the rates of taper relief.
A further extension to the nil-rate band and residence nil-rate band can’t be ruled out. The chancellor used her 2024 Autumn Budget to extend the current freeze from 2028 to 2030.
3. Income Tax threshold freeze
Back in 2024, while the IHT threshold freeze was extended, Reeves announced the end of the freeze on Income Tax thresholds, but only from 2028.
One year on, now might be the time to extend the freeze to 2030.
This might fulfil the manifesto promise not to raise Income Tax, but it is a stealth tax that could raise an extra £10 billion.
4. Capital Gains Tax in line with Income Tax?
Changes to Capital Gains Tax (CGT) were first suggested by the now-defunct Office of Tax Simplification back in 2020.
The Annual Exempt Amount has fallen from £12,300 in 2022/23 to just £3,000 in 2025/26. The rates payable have also increased, from 10% to 18% for basic-rate taxpayers and 20% to 24% for those on the higher rate.
Despite this, government receipts from the tax have fallen. This could prove to be a cautionary tale for the chancellor if she looks to make changes elsewhere.
On CGT, though, a final throw of the dice might be to increase CGT rates in line with Income Tax.
5. Taxing landlords
The Renters’ Rights Bill looks to abolish so-called “no-fault evictions”, but landlords could be targeted elsewhere, too.
Some experts speculate that the chancellor could use her Autumn Budget to introduce a new class of NI, payable by landlords on rental income.
If you own buy-to-let property, this could be a significant change, but as with all of the above, this is merely speculation, so it’s important not to panic.
Stay calm and avoid emotional decision-making
The build-up to last year’s Budget saw widely reported speculation about changes to tax-free cash entitlement on pensions. As a result, many worried pre-retirees opted to take the plunge and secure their 25% tax-free lump sum.
When the rumoured change didn’t materialise, those who made this decision were stuck with their choice.
It’s important to remember that your plans are long-term and are robust enough to ride out economic uncertainty, political upheaval, and legislative change. So don’t panic and stay focused on your goals.
Remember, we’ll be watching the Budget to find it how it might affect you, so you’ll have peace of mind that we’re in your corner.
Get in touch
If you’re looking for an independent financial adviser in Milton Keynes or Olney, look no further. At Jane Smith Financial Planning, we’ve been helping clients for 30 years, so contact us at info@janesmithfinancial.com or call 01234 713131 to see what we can do for you.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
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