Wednesday 3rd March will see the Chancellor announce fiscal changes. Let us speculate what these changes to the budget might be and why.

One Budget, two financial statements, and several televised pandemic briefings later, Rishi Sunak is one of British politics’ most recognisable faces. Throughout this pandemic many have questioned how the country will pay for the actions taken to minimise the financial impact of COVID-19. There are some relatively ‘soft’ targets that he could exploit. He might consider Corporation Tax, Inheritance Tax, Capital Gains Tax, and freezing or reducing some personal allowances.

There could be the introduction of a Wealth Tax (other countries have done this). My feeling, however, is that it might not be palatable currently. I have drawn attention to the theory that the introduction of high taxation results in people finding ways around it previously.

Remember that tax evasion is illegal and that tax avoidance is usually legitimate. There are ways of taking advantage of allowances and tax breaks that can reduce tax exposure, and careful financial planning can be beneficial.

Capital Gains Tax is considered by many to be a potential ‘Cash Cow’. Business Asset Disposal Relief could impact on shareholders within a business. The use of tax-efficient wrappers could come under scrutiny, and the potential impact of Inheritance Tax planning might affect a more significant proportion of people.

If this resonates with you, speak with an Independent Financial Adviser, or your accountant, before something changes that you wish you had addressed before it may be too late.

Eamonn Dorling Dip PFS, Senior Independent Financial Adviser

Email: Eamonn@brookswealth.co.uk

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