Introduction
Since when did we end up with two budgets?
Budgets: Governments require parliament's approval to spend money and raise revenue through taxes. The government lays out its plans for new taxes and welfare policies, and changes to existing taxes and welfare policies, in the budget, with the chancellor giving a speech to the House of Commons. As well as setting out the government's plans for taxes, budgets also give an overview of the general state of the UK economy.
Before 1998, the budget was held in the autumn, but between 1998 and 2016, it was usually held in the spring, just before the start of the new financial year. However, after the then chancellor Philip Hammond decided in 2016 to have just one principal fiscal event a year – in line with most other major countries – the budget was moved to the autumn, followed by a spring statement just before the end of the financial year. Hopefully, that’s enough changes for a while!
There is always speculation before a budget, but this year seems much more frenetic. One explanation is the delay between forming a new government and its first budget. Historically, this period has been relatively short, but it will be around four months since Labour took office, so plenty of time for people to work themselves up into a lather.
We're taking calls from concerned clients who've read or heard that they should take evasive action, such as giving everything to their children, selling their second homes, selling their businesses, cashing in their pensions or ISAs, paying off their mortgages, borrowing more, etc.
There are approximately 40 significant 'areas' of budget change being discussed, which are too many to predict correctly, and any attempts to pre-empt will almost certainly backfire.
We’ve been saying for years that no one can predict the future - not us, the newspapers, or some random man in the pub - so please don't try. Whatever change comes, we'll be there to help.
We cover some of the other topical matters in our newsletter, which we hope you will find useful.
If our newsletter prompts any questions, or if there is anything we can help you with, do get in touch. We will be pleased to hear from you.
* This newsletter is for general information only and is not intended to be advice to any specific person. You are recommended to seek competent professional advice before taking or refraining from taking any action based on the contents of this publication. The Financial Conduct Authority does not regulate tax advice, so it is outside the investment protection rules of the Financial Services and Markets Act and the Financial Services Compensation Scheme. The newsletter represents our understanding of the law and HM Revenue & Customs practice as of October 2024.
Past performance is not a reliable indicator of future performance. The value of investments and the income from them can go down as well as up and you may get back less than you invested. The value of tax reliefs depends upon your individual circumstances. Tax laws may change. The Financial Conduct Authority does not regulate Accountancy Services, Legal Services, Taxation Advice, Business Consultancy Services, Estate Agency Services and some forms of private banking and debt consolidation.