The first Autumn Budget in 20 years will be on 22 November – the last was delivered by Ken Clarke in 1996 - and the Chancellor is likely to be relatively limited in what he can offer the nation, as the shadow of Brexit and a big divorce bill looms large.
However, the experts have already started outlining what they expect to be in the Budget, so we thought it would be worth giving you a flavour of what you are likely to see on the day.
There is unlikely to be any change to the main ISA allowance, as this rocketed from £15,240 to £20,000 this year and yet cash ISA subscriptions fell by £1.638m in the last year - due in a large part to the Personal Savings Allowance (PSA).
The PSA means that basic rate taxpayers can earn up to £1,000 of savings interest tax free, higher rate taxpayers are eligible for a £500 tax-free PSA.
As this means that many savers will no longer pay tax on their savings anyway, the appeal of cash ISAs has waned, but should still not be ignored.
It is worth noting that additional rate taxpayers are not entitled to a PSA, so cash ISAs will still be valuable to them.
You should always at least consider any tax allowances when offered, because you never know when they will be taken away. But that is one of the key reasons for continuing to use cash ISAs. Once opened, anything saved into a cash ISA will be protected from tax for years to come and it is unlikely, although not impossible, that any future changes affecting cash ISAs would be applied retrospectively.
However, if your cash is not protected in this way, any changes to tax reliefs are more likely to have an immediate impact.
The Junior ISA and Child Trust Fund limits should increase by inflation each tax year, so these limits will hopefully rise from the currently level of £4,128 in April.
Savers have not had the best of times in recent years, that is for sure, but there is some scope for the Chancellor to consider tax reliefs available.
Accountancy firm EY anticipates some change in the Enterprise Investment Scheme, which could see the 30% tax relief set in 2011 reduced to 20%. Conversely, providers of EIS schemes are not anticipating a reduction in the level of income tax relief but do expect changes to the type of businesses which qualify for relief.
The Inheritance Tax Residence Nil Rate Band which was introduced in April 2017 at a starting level of £100,000, increasing each year by £25,000 and reaching £175,000 by 2020, is unlikely to be changed. .
Rarely does a Budget go by when no change is made to pensions and there is speculation the Chancellor could target them again as the cost to the Exchequer of funding pension tax relief has continued to increase, despite the introduction of a tapered annual allowance for high earners in 2016.
Some commentators are speculating that pensions tax relief could be set at a flat-rate of 30%, reducing the amount available to higher rate taxpayers, who can currently get either 40% or 45% tax relief on their contributions, but raising the 20% available to basic rate taxpayers.
Speculation is also rife that the amount you can contribute to a pension and obtain tax relief may be reduced across the board for all pension savers.
The 25% tax free lump sum has so far escaped reform and if it is targeted this year, the chances are it will remain in place for existing pensions, but there is no guarantee.
The additional 3% added to Stamp Duty Land Tax (SDLT) on second homes and buy-to-let properties has added an extra £8.6 billion to the Government’s coffers in the 2016/17 tax year, according to Chris Sanger, head of tax policy at accountants EY, and that is on just 1m transactions.
This has pushed up the overall take on SDLT by 17% compared to 2015/16, but disguises an 8% drop in overall property transactions, taking residential transactions to their lowest level since before the credit crunch. So, there could be some tinkering here to ensure the aims of creating new developments and affordable housing are met. One suggestion is to abolish stamp duty for older homeowners to encourage them to downsize and free up property for younger families.
Lower taxes for the young
One of the ‘buzz’ phrases for the current Government is ‘intergenerational fairness’ and this could lead the Chancellor to offer some tax breaks for the young, either through a reform of National Insurance – which he had to backtrack on last year, so is likely to be more cautious this time – or the re-introduction of an age allowance aimed at the younger generation, rather than older people.
Whatever happens, you can catch up on everything that is relevant for you in our newsletter next week.