Stef’s market overview – September 2024

The chancellor’s autumn budget is on the horizon, and it’s shaping up to be a tough one. In this month’s market overview, Stef takes a closer look at potential changes to inheritance and capital gains tax – two areas that could have a significant impact on your financial planning.

Brace yourself and hold on tight… Get ready for some tough news in the chancellor’s autumn budget. The first budget from Rachel Reeves, set for 30 October, is expected to bring spending cuts and tax hikes. While Labour’s manifesto promised no changes to income tax, national insurance, or VAT, there’s speculation about other areas that could be hit.

Inheritance tax:
This is likely to be targeted. Currently set at 40% on estates above £325,000, the threshold could be lowered, or the tax rate increased to raise funds.

Capital gains tax:
Capital gains tax is applied to profits from selling assets like second homes, shares, and business assets. At the moment, the first £3,000 of profits is tax-free (£1,500 for trusts). However, the exemption could be removed, with more assets potentially becoming taxable.

For our clients considering acquisitions, business sales, or buy-ins/buy-outs, these potential changes could have a huge impact. Stay informed and plan accordingly.