Here are reactions to the UK Autumn Budget, covering areas such as property, savings, pensions and earnings.

Following yesterday's tax-raising UK budget (see the main points), we carry these reactions. 

Marc Acheson, global wealth specialist at Utmost Wealth Solutions
“Taken together, these two measures [tax incentives for high-talent arrivals to the UK, and a curb on IHT charges on trusts] appear to be an acknowledgement that the changes announced in last year’s Budget to the non-dom regime went too far, that the UK has lost too many of these individuals, and that policymakers have to do more to stem this outflow and get the country back to becoming an attractive destination for wealth. This is particularly important given the country’s top 1 per cent of taxpayers contribute to a third of all tax revenue,"

James Dean, pensions partner at law firm Freeths
“The decision to cap salary sacrifice contributions to pension schemes will be incredibly unpopular across the pensions industry. Introducing this measure from 2029 risks sending the wrong signal at precisely the wrong time. With many people already struggling to save enough for their retirement, this policy could hugely discourage pension savings and undermine long-term financial security. Rather than incentivising individuals to build adequate retirement pots, it risks creating further barriers to saving.”

Sarah Coles, head of personal finance, Hargreaves Lansdown
“The Treasury is hoping to cash in on the fact that property prices have grown so impressively over the past few years. It’s hardly surprising, given how much wealth is tied up in property, but it raises some major issues. Those who are property rich and cash poor could end up stuck in a home that no longer meets their needs, facing a lower standard of living because of something they had no control over. If you’re worried by this change, it’s worth taking stock of your position to see what you can do.

The report indicates that council tax will rise for properties worth more than £2 million. This will be coupled with a revaluation of homes in the highest tax bands. This would mean a more realistic reflection of property values in tax bills. It would come at a cost but is fairer than simply bumping up council tax across the highest property bands.

Prices in England haven’t been revalued for council tax purposes since the system was introduced in 1991. Price rises since then have been lumpy. In London they’re eight times higher than they were in 1991, whereas in the north of England they’re 3.5 times higher. This isn’t reflected in the banding, so someone in a much more expensive home in the south has been paying the same tax as someone in a less expensive home in the north.

It will particularly affect those whose property prices have risen the most since 1991 – including owners in London and the Southeast. It would also throw a bigger tax burden on those living in more expensive homes.

There’s no guarantee that those in more expensive properties can afford a bigger monthly bill. Those who are property rich and cash poor could end up facing a lower standard of living because of something they had no control over, or being forced to sell up and downsize. It could take a toll on house prices for pricier properties, because people could be wary about buying a home with such a large council tax bill attached. If this makes the top of the market more sluggish, it will feed down gradually to cheaper homes and could hold up sales across the market."

Helen Morrissey, head of retirement analysis, Hargreaves Lansdown
“Salary sacrifice on pension contributions enables workers to get the full value of every pound through income tax and National Insurance savings. Restricting the amount of someone’s salary that can be sacrificed to £2,000 a year will make people feel that bit poorer and we could see less going into pensions as a result.

As an example, a worker earning £50,000 who saves 5 per cent of their salary would miss out on savings of £40 per year. At a time when the government is looking to improve pension adequacy it seems counter intuitive to do something that could put people off boosting their contributions. The cost to employers could also be substantial at £75 per year for someone earning £50,000 and £450 for someone earning £100,000. Multiply this across a workforce and the costs mount up quickly. It could lead to employers limiting salary increases or opting against increasing their own contributions beyond auto-enrolment minimums.

It’s a move that could have huge impacts on people’s retirements. A 22-year-old earning £25,000 per year receiving 3 per cent per annum as an employer contribution on top of their own 5 per cent one would reach retirement with a pension pot of £226,000. However, if the employer had been able to boost their contribution to 5 per cent the end result would be closer to £283,000.

At a time when there is such a focus on pension adequacy it seems counter intuitive to put barriers in the way to boosting contributions."

“Taken together, these two measures appear to be an acknowledgement that the changes announced in last year’s Budget to the non-dom regime went too far, that the UK has lost too many of these individuals, and that policymakers have to do more to stem this outflow and get the country back to becoming an attractive destination for wealth. This is particularly important given the country’s top 1% of taxpayers contribute to a third of all tax revenue," Marc Acheson, global wealth specialist at Utmost Wealth Solutions, said.

Clare Munro, tax advisor at Weatherbys Private Bank 
“It’s the chilly budget we expected with income tax and IHT [inheritance tax] allowances frozen for a further three years to 2031. The higher rate income tax threshold, which is currently £50,270, should now be £63,075 if it had risen with inflation – those on that upper number are paying over £3,000 extra in tax a year already as a consequence. That will only grow and hit more people. And it’s three times as bad for many additional rate taxpayers who’ve seen their allowance fall from £150k to £125,140 since April 2023. 
 
"IHT will hit more people too. Most couples have £1 million in IHT allowances, but if these had risen with inflation they’d be over £1.4 million today. It means that estates worth more than that are incurring £177,000 extra in taxes because of the freezes. And with pensions losing their IHT relief in 2027 a lot more people will be affected by this. My advice to older clients after this budget is to fly first class, give more to your kids and be careful crossing the road! The government’s take on IHT is just going to rise and rise and there’s now a definite incentive to live long, spend more and give sooner.
 
“The Chancellor talked about creating an economy for those starting businesses but the 2 per cent increase in dividend tax will hit entrepreneurs who often pay themselves out of profits that have already been taxed at 25 per cent. The salary sacrifice will hit those who’ve invested every spare pound in growing their business and then reach the point when they can play pension catch-up with large contributions. It will also hit companies wanting to share profits through bonuses to staff. It was a tax efficient way of encouraging retirement saving. But at least the government has been sensible on Business Property Relief being transferable between partners - people were tying themselves in legal knots trying to avoid the IHT fallout from that.” 

Neil Insull, partner at Blick Rothenberg
“For many individual investors, the announcement to raise income tax rates on dividends, property and savings income from 2027 will swing the pendulum in favour of investing through a company. I expect to see personal and family investment companies being used more.”

Sarah Coles, head of personal finance, Hargreaves Lansdown
If a person breaches their personal savings allowance, basic rate taxpayers will pay 22 per cent on interest, higher rate taxpayers 42 per cent and additional rate taxpayers 47 per cent. This equates to a 2 per cent rise across the board.

“This is a really shocking tax rise for savers. If the Budget speech includes a cut to the cash ISA allowance it will mean that there’s a risk more people will be saving outside a tax-efficient environment and be exposed to this new tax rate.

“The personal savings allowance will still protect the first £1,000 of savings interest for basic rate taxpayers and £500 of interest for higher rate taxpayer, but after that people will face a hike in their tax bill. It’s going to be more important than ever to take advantage of cash ISAs.”

Jason Hollands, managing director at wealth management firm Evelyn Partners
“These hikes seem to be aimed mainly at extracting more cash from the UK’s small business owners, who don’t have the option of owning their company shares in a tax efficient Individual Savings Account. It will be felt by entrepreneurs as a kick in the teeth, as it takes guts to set up a small business and cash-flow can be uneven and profits uncertain, especially in the current environment where the economy is struggling. 

“Given these uncertain profit streams, many business owners chose to pay themselves only a limited fixed salary and instead opt to pay themselves varying amounts via dividends from profits, and in some cases that makes up the majority of their income. 

“Headline dividend tax rates have long been lower than their corresponding income tax bands. While some may regard this as an anomaly in the tax system, this arrangement has been there for a very good reason: dividends are paid out of profits that have already been subject to corporation tax. 

“This is levied at 19 per cent for companies with profits under £50,000 and 25 per cent for companies with profits over £250k, with marginal relief between those bands. So, comparing headline dividend and income tax rates is a very partial picture, and these hikes mean that in many cases the Treasury will be milking the same income stream twice. With the rewards for entrepreneurship and risk-taking suffering several blows recently – rising National Insurance and capital gains tax burdens among them – it is no wonder that many business owners will feel despondent about the increasingly hostile tax environment. 

While business owners may be the main target, the hike in dividend tax rates will also impact anyone owning income generating shares or funds outside of ISA and pension tax wrappers, especially now that the annual dividend exemption is a pitiful £500 a year, having been cut aggressively by the previous Conservative government. As recently as 2017/18 it was as high as £5,000, so it is now frankly a token amount."

The Association of Investment Companies, which represents investment trusts
It said curbs on cash ISAs was positive because it would stimulate flows into risk assets, such as equities.

Richard Stone, AIC’s chief executive
“This is a carefully considered solution that promotes the benefits of investing in the stock market for the long term, whilst addressing concerns of older savers who prioritise financial certainty. Cutting the cash ISA limit is a milestone towards creating a nation of investors. Combined with the planned advertising campaign, changes to risk warnings and the FCA’s targeted support initiative, it will all help people make better long-term investment decisions. We need a strong investment culture in the UK and it is encouraging to see the government starting to build the foundations for this.

“The new cash ISA limit will incentivise more than two million people to start investing in the stock market – rather than taking the risk of their long-term savings being eaten away by inflation. Of course, people need to save cash for a rainy day, but encouraging them to move beyond that will improve their financial resilience, achieve better financial outcomes and bring benefits to the broader economy.”
 
Rachael Griffin, tax and financial planning at Quilter
"In a shambolic turn of events even before the Budget has started the freeze on income tax levels to 2029/30 has been revealed by an OBR leak. The multi-year freeze on income tax thresholds has now been extended, locking households into one of the most powerful stealth tax rises in modern fiscal policy.

"Reeves has had to renege on what was her rabbit out of the hat moment at her maidan Budget. Given in her speech last year, she said that an extended freeze would hurt working people, this must represent breaking the party’s manifesto pledge.

"With wages rising while thresholds stand still, millions more people will drift into higher tax bands regardless of whether their real living standards have improved. What had initially been framed as a temporary measure has now seemingly become a structural feature of the tax system and will significantly increase the tax take over the rest of the decade.

"For workers across the spectrum, the impact is sharp. Pay growth that would once have felt like genuine financial progress now pushes people into higher rates of tax far earlier than expected. Had the £12,570 personal allowance risen in line with inflation from when it was first frozen in 2021 until now, it would be worth £15,714. Had the £50,270 higher rate threshold done the same, it would be worth £62,845 today. The pressure is felt most acutely by those around the higher rate threshold and those on the cusp of losing their personal allowance at £100,000, where the effective marginal rate reaches 60 per cent. Extending the freeze compounds these pressures for years to come. When first introduced in 2021 the OBR estimated the freeze was expected to raise £8 billion a year by 2025/26 bringing 1.3 million more into paying tax and 1 million more into paying higher rate. When extended to 2027/28, it was expected to raise £26 billion a year by 2027-28, bringing 3.2 million more into paying tax and 2.6 million more into paying higher rate.

"The policy raises substantial revenue without increasing headline rates, but the cost is transparency. Households will feel the squeeze long before they understand where it came from. The extension also risks distorting work incentives and delaying progression as more of any additional income is clawed back."

Mike Ambery, retirement savings director at Standard Life, part of Phoenix Group
“The Chancellor’s decision to cap salary sacrifice at £2,000 a year marks a significant shift in how people can save for retirement. Salary sacrifice has long been one of the most efficient ways for workers to boost pension contributions, so limiting it will inevitably increase costs and reduce take-home pay for many. The surprise today is that the changes will apply only to individual’s contributions and employer contributions will remain exempt from National Insurance. While the change is significant it is less damaging than feared and potentially creates a number of options for people to maintain their level of saving. This will include negotiating higher employer pension contributions in return for lower pay although we will need to wait and see how this is implemented.

“This change will disproportionately affect private sector workers, as public sector schemes don’t usually use salary sacrifice. At a time when simplicity and engagement are critical to improving savings levels, adding complexity and reducing incentives risks undermining confidence in the system. It’s also vital that consideration is given to the timing of this change. The official papers highlight that no additional tax revenue is expected until 2029, pointing to a gradual implementation. In the meantime people will want to make use of the arrangement to the full extent they’re able to. Employers will still face a considerable amount of administration to comply and will need to put thought into communication. 

“Pension saving depends on stability and trust, and frequent policy changes make people question whether the system works for them. This change comes as the Government is reviving the Pensions Commission to tackle the UK’s retirement savings gap – limiting salary sacrifice could undermine efforts to improve savings adequacy at a time when millions are already undersaving for retirement. Reforms should support the goal of ensuring that people can retire with financial security, not hinder it.”

Malli Kini, a partner at Blick Rothenberg
“A 2 per cent rise in dividends won’t just raise revenue – it will change behaviour. More money will stay locked in companies or be diverted into planning structures instead of being reinvested in the economy.”

Daniele Antonucci, chief investment officer at Quintet Private Bank (parent of Brown Shipley)
“The UK Budget looks like one of the most consequential in years, aimed at restoring fiscal credibility after previous episodes of bond and currency market instability.

“The fiscal stance leans towards austerity to stabilise the debt trajectory and reduce the risk of bond-market disruption and sterling volatility. Judging by the leaked report from the Office for Budget Responsibility, a higher fiscal headroom than expected could possibly reassure bond investors.

“We think the overall fiscal stance is supportive for gilts, as fiscal consolidation keeps rate cut expectations alive and helps anchor long-term yields. Ahead of the Budget, we increased our position in gilts to a larger overweight, as yields look attractive and we prefer to lock them in before they could decline next year with additional Bank of England rate cuts. The Budget is tougher for near-term economic and earnings growth, with households and businesses likely feeling the squeeze.

“Even though the OBR has reduced its economic forecast for next year, we still believe it’s on the high side and see downside risks. That’s disinflationary, and one reason why we expect the Bank to cut rates again in the near term, possibly weakening the currency vs the euro, as the European Central Bank appears to have ended its rate cutting cycle.

“We still expect sterling to weaken slightly vs the US dollar, given that we anticipate more rate cuts from the US Federal Reserve. On equities, we prefer larger-capitalisation UK stocks, which are more global than smaller domestically oriented companies. We’re tactically overweight the FTSE 100 index, which offers diversification benefits when combined with US equities, given their complementarities.

“The FTSE 100 offers exposure to large global companies in value-oriented, often cash-generative sectors such as financials, energy and consumer staples. It tends to be more defensive, yield-oriented, and less volatile when growth sectors under-perform. The US equity market, by contrast, offers heavy exposure to growth sectors such as technology, communications and consumer discretionary, which tend to deliver higher growth and higher volatility over cycles.”

Amisha Chohan, head of equity research at Quilter Cheviot
Chohan commented on the stamp duty “holiday” on IPOs.

“Today’s measures from the Chancellor are aimed at stimulating the UK’s capital markets, but in reality will have a muted effect. Stamp duty on shares has often been one of those taxes that is forgotten about after the likes of capital gains tax, but consecutive chancellors have refused to reform it given its impact on the tax take. It means that investments are effectively taxed twice if they are not held in a tax efficient product, with stamp duty taking effect on purchase and capital gains tax on exit. When you add in dividend tax, and potential inheritance tax liabilities too, and the total take on shareholdings is significant.

“The government is rightly looking at ways to boost the UK’s markets, but a much more effective reform would be to abolish it completely. Having a three-year holiday for new listings is unlikely to move the dial. Investors, particularly institutional ones, think in time periods of five years or in some cases far more.

Philly Ponniah, chartered wealth manager and financial coach at Philly Financial
"A mansion tax sounds simple but it hits a very real group of people who sit on high value homes yet feel anything but wealthy. Many bought decades ago, long before their street became a hotspot, and an extra annual charge lands on their day-to-day cash flow. For these households, it isn’t a painless wealth tax, it’s another bill they have to find from sometimes already stretched income. The risk is that some will feel pushed into selling, not because they want to move, but because they can’t absorb a recurring cost tied to a paper valuation.”