The upcoming 30 October Budget speech has triggered a wave of anxiety among clients regarding potential changes to pensions and capital gains tax (CGT).
- Financial advisers are experiencing an increased demand for advice ahead of the Budget speech due to clients’ concerns about possible tax alterations.
- AJ Bell’s research indicates that virtually all advisers have been queried about potential impacts from anticipated fiscal policy changes.
- Significant speculation surrounds possible changes to inheritance tax (IHT) and pension tax relief, heightening worries among clients.
- A considerable percentage of clients express concern regarding the implications of tax-free cash and the possibility of increasing pension contributions.
As the 30 October Budget announcement approaches, advisers are witnessing heightened anxiety from clients over prospective alterations to pension policies and capital gains tax (CGT). This apprehension stems from speculations surrounding Chancellor Rachel Reeves’ forthcoming speech, which is expected to address these critical areas of financial planning. According to data provided by AJ Bell, an overwhelming 99% of financial advisers have encountered client inquiries regarding the potential ramifications.
The speculation centres on proposed modifications to inheritance tax (IHT), CGT, and pension-related measures, notably tax relief and tax-free lump sums, which have become focal points for advised clients. Notably, AJ Bell conducted an online survey from 30 September to 2 October, revealing that 33% of advisers received queries about tax-free cash, while 16% were approached for advice on augmenting pension contributions. Such figures underscore the prevailing sense of uncertainty that has gripped investors.
Within this climate of fiscal uncertainty, advisers are compelled to provide clarity and reassurance to their clients, addressing their concerns and equipping them with strategies to navigate potential policy shifts effectively. The prospect of changes to key tax areas necessitates a comprehensive understanding of existing and future regulations to safeguard clients’ financial well-being.
The looming Budget speech has intensified discussions about IHT, a tax often deemed unfavourable by the public, and its potential increase in the forthcoming fiscal plans. Additionally, there is growing speculation about hikes in CGT on the sale of shares, which some commentators have described as ‘debatable’ in terms of its policy effectiveness. This broader apprehension reflects the challenges advisers face in predicting and mitigating future legislative impacts on personal finance.
In sum, the impending Budget speech has catalysed a tidal wave of concern among clients regarding potential tax changes, leaving advisers to play a pivotal role in assuaging fears during these uncertain times.
