Budget policy fears

My biggest fear is yet more tinkering with pension rules and taxation. Stability is what savers and advisers really need, not constant change. The worst-case scenario would be the introduction of National Insurance on pension contributions — or worse still, on pension income payments — which would undermine retirement planning completely. With the IHT rules on pensions already announced, hopefully the Chancellor will see sense and leave pensions alone for a while.

I’m also concerned about talk of extending the seven-year clock for inheritance tax gifts to ten years, which would further penalise families trying to plan responsibly.

And as a business owner, Corporation Tax remains a worry. After years of hard work building the business, it’s disheartening to see a quarter of profits go straight to the taxman — and I fear the Government may be tempted to raise it further.

Ahead of Rachel Reeves’ looming Budget, our priority is protecting clients. We’ve been stress-testing client portfolios and accelerating planning in case tax changes hit savings, pensions, or investments. The pension changes coming in April 2027 has also expedited immediate IHT planning for older clients with large pension funds.

Ahead of the Budget, SMEs are also preparing for possible hits on corporation tax and employment costs. Rachel Reeves’ reforms could reshape the small business landscape for the worse, further squeezing some businesses that are teetering on the brink already.

Many of our SME clients are already putting recruitment on hold, freezing pension contibutions and considering cancelling perks such as private medical insurance. The overall sentiment from SME owners for the future is rather bleak.

This government has shown itself to be highly unpredictable, and at times its short-sightedness is quite remarkable—though much of this seems to stem from a lack of depth and knowledge in policymaking. Too often, the measures introduced have proved unpopular and ultimately punishing for the everyday individual rather than supportive. Changing pension rules has been the biggest issue to date, and any further ad hoc changes would undermine people’s confidence in pensions and discourage saving.
Looking ahead, no one can say with certainty what might appear in the next Budget. My approach with clients is to remain calm and pragmatic: I advise them not to act hastily on speculation, but instead to sit tight, review any changes once announced, and then make informed, considered decisions. I would never base advice on what may or may not happen—it is only once the detail is published that we can properly assess the impact and respond accordingly.

As the Autumn Budget approaches, my biggest concern as an adviser is the potential for surprise policy changes that could unsettle clients. Pensions, National Insurance, and property taxes all appear to be in the firing line.
There’s a lot of speculation and scare-mongering in the media right now, but my focus remains on helping clients understand how any real policy changes may impact their long-term strategy — not the short-term noise. Reacting to headlines can often lead to rushed decisions that do more harm than the policies themselves.
It’s important to have open conversations with clients at times like this. However, the best financial plan is usually the one you can stick to even when the news cycle gets noisy.

As financial education specialists, we are particularly worried about the changes that are almost certainly about to hit pensions. The system is complex enough as it is, so more tinkering around the edges could make it even harder for people to understand what they need to do to prepare for a financially secure retirement.

If the changes are more than just 'tinkering', then it could have the effect of damaging confidence in the whole assumption that saving for retirement is a good idea. People will end up thinking, what's the point of making sacrifices now if the government will just find ways to claw it back later on?