Speculation about sweeping tax changes in the upcoming autumn Budget has already reshaped household financial decisions, according to new polling, which shows widespread pension withdrawals, accelerated property sales and a rise in offshore asset movements. The survey by Opinium found that nearly three in five independent financial advisers (58%) reported their clients have taken pension lump sums due to fears over cuts to tax relief, while a quarter said they had sold private rental properties.
James Endersby, chief executive of Opinium, said: “Our research highlights the degree to which Budget speculation is already influencing financial behaviour. With rumours of major tax changes growing, many IFAs [independent financial advisers] are seeing clients act pre-emptively, from drawing down pension lump sums to offloading rental properties.”
His warning reflects the intense uncertainty building around the chancellor’s plans. Rumoured reforms to pension tax relief have dominated adviser conversations, with more than three-quarters (77%) of IFAs noting that clients have raised concerns about potential changes. That anxiety has already altered retirement planning, with 11% of advisers stating some clients now intend to delay retiring until after the Budget, hoping for clarity before locking in long-term decisions.
Property markets have also been caught in the crossfire. One in four advisers (26%) reported clients selling buy-to-let homes amid speculation that rental income could be made subject to national insurance. A similar proportion (24%) say clients have brought forward disposals, while 22% have seen the crystallisation of unrealised gains or losses as homeowners brace for potential tax adjustments. Nearly one in five (18%) noted delays to major transactions, such as house purchases, due to concern about rumoured new property taxes.
Endersby’s comments come as advisers brace for the possibility of changes to capital gains tax on main homes, a proposal that more than half of IFAs (54%) said their clients fear. Worries about a new wealth tax are also widespread, raised by almost two thirds (64%) of clients, while similar numbers express unease about national insurance (NI) being applied to rental income (55%) or an increase in the basic rate of income tax (53%).
Against this backdrop, households are shifting into defensive positions. Around 17% of advisers reported clients increasing cash holdings, opting to remain liquid until the chancellor sets out her plans. More strikingly, one in 10 IFAs (9%) said they have clients who have moved assets offshore or abroad due to Budget concerns, highlighting the extent to which speculation alone is driving capital flows.
Endersby said the pattern of behaviour shows how quickly uncertainty can cascade through financial planning long before policy details are confirmed. “This level of activity underscores the deep uncertainty about what the chancellor may announce in the Budget,” he said. “While we don’t yet know how much of the speculation will be borne out, the impact is already being felt in people’s financial behaviour.”