As we approach the Chancellor’s Budget announcement on Wednesday, there’s no denying the significant gap in public finances. Things haven’t gone as planned so far in this parliamentary term, so the Government will be looking for new ways to raise revenue. We wait with bated breath to see what approach she takes to addressing this.
The speculation ahead of this Budget has been like no other, but the Government have thankfully given clarity on two points:
- Income Tax rates will not increase, and
- The tax-free lump sum on pensions will remain.
A relief for millions on both points.
What we’re watching closely
While headlines for recent months have inevitably focused on speculation and political spin, our stance remains the same: to plan based on facts, not forecasts. The media has its own agenda, which rarely aligns with your best interests.
Many announcements will be made in the Budget, with some having more impact than others. Pensions dominated last year’s announcements, so we’re hopeful they won’t be the main focus again. But there are a couple of topics we’re keeping an eye on in particular:
- Potential changes to gifting rules, including lifetime caps or adjustments to the “normal expenditure” exemption, and
- Any updates to ISA allowances and how these can be structured moving forward, with particular attention on Cash ISAs.
What happens next
Later this week, we’ll share a clear summary of the key Budget measures. After that, we’ll take time to reflect on what the changes mean in practice. For those we work with, this will include creating strategies tailored to individual circumstances and objectives. The aim is always to make the most of any changes, while keeping longer-term plans on track.
Budgets create uncertainty, but the best approach is to make informed decisions based on your life-focused objectives. After all, money should serve your life—not the other way around.
If you’d like to explore what the Budget might mean for your plans, we’re here to help.