Six actions to protect your finances before the Autumn Budget

Speculation is rife about what could be in chancellor Rachel Reeves’ much anticipated Autumn Budget.

Reeves will deliver her latest fiscal update on 26 November and there are likely to be “significant changes to wealth and property taxes”, said BDO, with changes to pension tax reliefs and inheritance tax also a possibility.

The chancellor is facing pressures of a fragile global economy and “anaemic” UK growth, said Fidelity, so while everything is just speculation for now, she will be looking for “new ways to raise revenue this year”.

Here is how you can prepare.

1. Hurry up your home sale

There have been reports that property taxes could be reformed, replacing stamp duty, plus capital gains tax could be charged on the sale of certain homes.

It could be worth “pushing to complete before November” if you are currently selling, said The Times, so that you still get the capital gains tax exemption.

2. Top up your pension

Pension rules are often a source of speculation ahead of the Budget, said BBC News, with possible changes such as “tax relief available to savers and the level of the tax-free lump sum which can be withdrawn”.

It is “rarely a bad idea to top up your pension”, said Continuum, as pensions are an “incredibly tax-efficient way to save for the future”.

You could also withdraw more now before any reported restrictions but it’s “really important not to rush in”, said Rest Less, as anyone who takes money out of their pension is putting it into a taxable environment.

3. Boost ISA contributions

There is “widespread speculation”, said Fidelity, that the overall £20,000 ISA limit could be cut for cash ISAs amid a government review.

It “makes sense to make the most of the ISA system as it stands”, said Saga, by making full use of your allowance.

Stocks and shares ISAs “typically return higher growth over time” compared with cash ISAs, but may not be suitable if you may need money in a hurry “or if you’re not comfortable with a level of risk”.

4. Make use of tax allowances

Reeves may have “unfinished business” with capital gains tax, said AJ Bell, having “pushed rates up a bit” in the previous Budget.

It is worth planning how to use your £3,000 capital gains allowance, said Continuum, plus spouses and civil partners can transfer assets to each other tax-free, “letting you benefit from their allowance as well as your own”.

The “easiest way to protect your money” from tax rises is to make use of “all your allowances”, said The Times, including the £20,000 you can put in an ISA, £60,000 that can go into pensions and the £500 that can be earned in dividends outside an ISA tax-free.

5. Consider inheritance tax

Inheritance tax may be another target for the chancellor, having already used the previous Budget to apply the charge to pensions.

If she wants to “target inheritances again”, said AJ Bell, she could either reduce inheritance tax thresholds or extend the “seven-year rule” for lifetime gifts.

Making any “significant gifts” before the Budget could help “secure today’s more generous rules”, said Clarke & Wright, but “be strategic, not hasty” as acting too quickly could cause tax charges and “leave you short of funds you may need in the future”.

6. Don’t panic

Any changes may not be “implemented immediately”, said CheltenhamIFA, so it is important not to panic.

You will usually have time to digest the changes and “carefully consider how you’ll respond”. Plus, it may be worth speaking to a financial planner “rather than making a snap decision”.