With just 10 days to go until the Autumn Budget on November 26, speculation is mounting over potential tax changes that could affect personal finances. Chancellor Rachel Reeves is reportedly considering freezing income tax thresholds for an additional two years, abandoning earlier plans to raise income tax directly. However, other measures—including a new levy on high-value properties and cuts to the Cash ISA allowance—remain under consideration.
Financial experts warn that while much is still uncertain, rumours close to Budget announcements often contain some truth. Laura Purkess, Personal Finance Expert at Investing Insiders, advises pensioners and savers to take four key actions now to minimise potential losses. These include maximising ISA contributions, switching to better savings rates, and reviewing pension salary sacrifice arrangements.
One of the strongest rumours is that the Cash ISA allowance could be halved from £20,000 to £10,000 or £12,000. Purkess recommends that those with sufficient cash should use their full allowance before the Budget, as any excess saved in a taxable account could incur significant tax charges. She also suggests considering a stocks and shares ISA for longer-term goals, as historical performance has been stronger than cash.
On savings rates, Purkess emphasises the importance of shopping around for the best deals. Top easy-access accounts currently pay around 4.5%, with Sidekick's Multi Shield account offering 4.48% and Tesco Bank's Internet Saver paying 4.2%. Even small differences in rates can substantially boost returns over time.
Pensions remain a target, with speculation that salary sacrifice—a method of paying salary into a pension without National Insurance—could be capped at £2,000 per year. Purkess cautions against panic decisions, as pension changes are often irreversible and can harm long-term growth. She advises seeking professional advice before making any major moves.
