Autumn Budget Predictions – What Do We Expect to See?

What to expect from the Autumn Budget

Chancellor Rachel Reeves is set to present the UK Autumn Budget on October 30. We expect changes to tax and government income.

The full details will be revealed on the day. However, several changes are already expected based on government pledges and forecasts.

Where changes are likely to happen

Capital Gains Tax (CGT) – A major focus of the budget is likely to be Capital Gains Tax. Experts predict the Chancellor may raise the rates to align them more closely with Income Tax rates. This would mainly affect wealthier individuals with investments or property. It would increase revenue by taxing gains more heavily. As a result, higher earners may need to rethink their investment strategies. They may need to plan for potential increases in CGT.

Inheritance Tax (IHT) – Changes to the Inheritance Tax are also expected, with potential reductions in exemptions or adjustments to reliefs. These changes would mainly target larger estates. They would encourage wealthier households to contribute more in taxes. This reflects Labour’s strategy of targeting wealthier individuals. Income and corporate taxes are expected to remain stable for most people.

Employers National Insurance – Before the general election, an increase to National Insurance Contributions (NICs) wasn’t expected, as Labour had ruled it out in their manifesto. However, rumours suggest the Chancellor may raise employers’ NICs from 13.8% to 14.8%, potentially bringing in £8-9 billion for the Treasury. This increase does not technically conflict with the manifesto. However, experts, including the Office for Budget Responsibility (OBR), warn it could have wider effects. Higher employer NICs may lead to lower pay rises or higher prices for consumers.

Fuel Duty – Fuel duty may rise for the first time in 13 years. This could increase costs for motorists and businesses. It may also act as an indirect tax on working people. This may also encourage a shift toward electric vehicles. Traditional fuel would become more expensive.

Pensions – There is considerable concern about the tax-free pension withdrawal threshold. Currently, savers who are 55 and over don’t incur any tax when they withdraw 25% of their pension pot, if it is up to the amount of £268,275. If rumours and predictions are true, the Treasury could drop this threshold to £100,000.

What this could mean for you

At Lifetime, we are keeping a close eye on the headlines and will be following the budget announcements closely. As experts in the financial management space, we know how such uncertainties can impact people’s lives.

We are here to guide and support you through these financial changes. If you have any questions or concerns regarding the anticipated updates, please don’t hesitate to reach out to a member of our team.

If you are an individual, you can talk to our coaches to then progress to speaking with an experienced and qualified financial adviser. Book a chat now!

If you are an employer or HR leader, our financial wellbeing benefit is an essential tool in your employee benefit offering, more so now than ever. Talk to us today and see how we can help look after the money concerns of your people. Get in touch with us now.

Written by Ione Morton, Marketing Executive at Lifetime