By Yisroel Sulzbacher, Accounts Senior

The economy remains unstable, the Autumn Budget is just around the corner and inflation rates continue to be high.

There’s plenty of stuff to be worried about if you’re a business owner looking at your finances.

According to the Guardian, the cost of financing UK government debt is now more than £100 billion a year, which is almost 10 per cent of the annual budget.

When the Chancellor, Rachel Reeves, delivers her Autumn Budget, she’s expected to announce (or try to hide) a £20 billion to £40 billion deficit which likely means between £30 billion to £50 billion in either extra taxes, reduced spending or higher borrowing.

I’ll cover the impact of extra taxes when we talk about the upcoming Autumn Budget, but the other two options aren’t good either.

Reduced spending by the Government means less state-funded demand for business products and services, which has the knock-on effect of slowing economic growth by reducing the overall demand for goods and services.

Higher government borrowing, on the other hand, means increased interest rates, making it more expensive for you to borrow and invest, which in turn reduces consumer spending.

Now the stuff we should be really worried about – possible higher taxes announced in the Autumn Budget.

The current predictions for the Autumn Budget are:

• Decreases to the ISA limit
• Pension rules being tweaked
• Capital Gains Tax (CGT) increases
• An Inheritance Tax shakeup

Let’s go through them one-by-one and what each scenario means for you.

Decreases to the ISA limit

In the Spring Statement earlier this year, the Government announced a full review of Individual Savings Accounts (ISAs), sparking speculation that cash ISA limits could be reduced.

At present, adults can save up to £20,000 a year tax-free across cash and stocks and shares ISAs, or a mix of both.

However, Reeves confirmed the review will examine whether the balance between cash savings and equity investments is right and the Government has made clear it wants more people to invest rather than keep funds in cash.

Presumably, the goal here is to deliver stronger returns for savers and support wider economic growth.

Any change to the ISA rules could mean rethinking how you split your savings between cash and investments.

Those of you who prefer the security of cash ISAs will find yourself with limited options, while the investors amongst you could find new incentives on the horizon.

Pension rules being tweaked

Ahead of last year’s Budget, many feared changes to pensions – from cutting the 25 per cent tax-free lump sum to reducing higher-rate relief on contributions.

In the end, nothing changed, though some rushed to draw from their pots early, which may be to their long-term disadvantage.

Unfortunately, acting on rumours rather than advice can backfire.

(Perhaps this is a good moment to suggest you speak with your accountant before making any decisions on potential Budget announcements).

While tax relief has dropped out of current speculation, its high cost to the Treasury means it could still be a future target, especially for higher earners.

Capital Gains Tax increases

Although CGT isn’t under formal review, the Government is too tied to its promises not to raise Income Tax, National Insurance and VAT.

Personally, I feel that other taxes like CGT and Inheritance Tax could be in the firing line.

Judging by the rhetoric surrounding the Chancellor and her upcoming statement, it’s likely that CGT becomes a wealth tax.

Whether that’s in the form of a so-called “mansion tax” whereby you’re taxed very heavily on homes above £500,000 or something else, it’s likely to hurt those who are more well-off than those who aren’t.

The Chancellor already lifted CGT rates at the last Budget, and further hikes or even different rates for assets such as second homes remain possible.

Another option would be cutting the annual CGT allowance again, though after successive reductions from £12,300 to £3,000, there is little left to trim.

If the allowances fall any lower, you could find yourself paying CGT on even the smallest investments.

An Inheritance Tax shakeup

Previous Budgets have already had an impact on the way Inheritance Tax is moving, with new charges set for farmland/agriculture in 2026.

(You may have seen Jeremy Clarkson going on about this one).

Pension funds are to be brought into estates from 2027 and there seem to be stirrings about more changes to follow.

In my view, the Chancellor might look at extending the seven-year rule on gifts to ten or even capping the total value that can be passed on tax-free.

If you have been reading the news, there are plenty of rumours which also point to further freezes on the nil-rate band and residence allowance.

Currently, these are stuck at £325,000 and £175,000 respectively and have been for years.

The issue is that this is pulling more families into the net as property values naturally climb due to a higher demand for housing.

Again, while it might feel tempting to rush gifts before any reforms happen, doing so without advice could cause long-term problems, especially if the money is needed later in life.

So, speak to your accountant!

The straw that breaks the camel’s back

If you’re a business owner or an individual whose considering their tax liabilities in anticipation of the Autumn Budget, this might be the one that hurts the most.

Whilst previous Budgets have had their impact, this one is shaping up to be fairly brutal – if all of our predictions come to fruition.

Plus, there’s no telling what surprises could be in the announcement itself – maybe I’m wrong about all of the above changes and Rachel Reeves will throw a curve ball at us.

Either way, it’s best to be prepared.

Don’t go into this Budget without a plan.

Don’t make rash decisions post-Budget without due consideration.

Most importantly of all, speak to an expert in business advice or tax planning as soon as possible – it might just save you a lot of money.

If you’re looking for a business adviser or tax expert, let’s have a no-obligations chat.