5 Smart Financial Moves to Make Before the Budget
As the Budget Approaches
With speculation growing that the Government may raise taxes on wealth, investment income and capital gains, now is an ideal time to review your finances. Acting early allows you to protect existing allowances, position your portfolio more efficiently, and avoid rushed decisions later.
1. Use Your Allowances Before They Disappear
The simplest way to stay ahead is to make sure you’ve used this year’s available allowances while they remain in place.
- ISAs: Up to £20,000 per person can be invested tax-free each year. Once the allowance resets, unused portions are lost.
- Pensions: Higher-rate tax relief remains valuable; consider maximising contributions while it’s still available.
- Capital Gains: The annual exemption is now only £3,000. Reviewing gains and losses before any rule changes could save tax.
- Dividends: The £500 allowance is small but still worth using efficiently through portfolio planning.
A short review with your adviser or accountant can confirm which allowances you’ve used and which are still open.
2. Review Income and Investment Structure
If you draw income from dividends, rental property or investments, check whether your current structure remains efficient.
- Assess whether your rental properties still deliver a strong after-tax yield.
- Explore investment bonds or diversified funds that defer or smooth taxation.
- Consider holding certain assets in the name of a spouse in a lower tax band.
- Reinvest surplus cash that is currently eroding in real terms due to inflation.
A small amount of restructuring before the Budget could significantly improve your long-term tax efficiency.
3. Time Gains and Losses Carefully
If capital gains tax rates increase, timing will matter.
- Consider “bed & ISA” or “bed & spouse” strategies to reset base cost within current rules.
- Crystallise losses now to offset existing or future gains.
- If you plan to sell property, shares or a business interest, take advice on whether to complete before or after the Budget.
The key is to prepare rather than react — allowing flexibility to act at the right time.
4. Align Your Strategy with Your Life Stage
Budgets offer a natural moment to step back and confirm that your financial plan still matches your goals.
- Approaching retirement: Use any available carry-forward pension allowances.
- Landlords: Model net returns after higher costs and reduced reliefs; a partial sale and reinvestment elsewhere may be more efficient.
- Higher earners: Check whether your adjusted income crosses the £100,000 or £260,000 taper thresholds, where allowances begin to reduce.
Small structural adjustments today can have a lasting impact on your tax position.
5. Stay Calm but Be Prepared
Effective planning is about readiness, not prediction.
- Make pension and ISA contributions early rather than waiting until after the Budget.
- Move unwrapped investments into tax-efficient wrappers where appropriate.
- Keep liquidity available so you can act quickly if new rules are introduced.
- Book time with your adviser or accountant now — their diaries will fill as November approaches.
Even simple steps, completed in advance, can make a meaningful difference.
In Summary
A well-timed financial review before the Budget can:
- Preserve allowances that might soon reduce,
- Mitigate exposure to higher taxes on income or gains, and
- Position your portfolio for efficient growth in the next tax year.
I’ve prepared a short Pre-Budget Checklist outlining the most practical actions to consider before November.
If you’d like a copy, please get in touch.
Disclaimer:
This article is for general information only and does not constitute personal financial advice. Tax treatment depends on individual circumstances and may change in future. You should seek regulated financial advice before making any investment or tax-related decisions.
