What will the Budget mean for you?

Unlike previous budgets, featuring dramatic announcements and unexpected changes, the main tax-raising measure – a rise in employer National Insurance – had been well publicised.  Likewise with the headline changes to Capital Gains Tax (CGT).  In other words, the increases in tax rates were expected, in part because the Government had announced in its election manifesto that there would be no changes to income tax, VAT, National Insurance rates on individuals, or the current rates of Corporation Tax.

As a general observation and, given the endless speculation, the Budget was probably not as ‘bad’ as many had feared. CGT rates could have been aligned with income tax rates, the annual CGT rate could have been removed, and there was talk of imposing a cap on the amount held in an ISA. In fact, most of the tax allowances set by the previous Conservative government were maintained.

Notably absent, however, were changes to arrangements for funding social care.  We know this is an area of concern for many of our clients and – although a major challenge – it is something the government is going to have to tackle sooner rather than later.  The increases in the national minimum wage and employer’s NI, which we talk about below, will inevitably further increase the costs of care.

For many people, the Budget announcements will not have an immediate impact on their financial arrangements.  However, the revelation that unused pension funds and death benefits will now be within the Inheritance Tax remit, albeit not until April 2027, will add additional complexity to inter-generational planning.  This will definitely be significant for some people, and we discuss this with our clients.

You can read fuller details – including on Capital Gains Tax,  Inheritance Tax on pensions, stamp duty, and Employer’s NI – in our Budget Newsletter.

If you’d like more information on the what the Budget could mean for you – or advice on financial planning more broadly – please do get in touch.  We’d be pleased to help.