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£5 million net worth. But how much is actually exposed to Budget tax changes?
The headline number tells you surprisingly little.
Consider someone with £5m in assets:
🏠 £2m home — A new High Value Council Tax Surcharge is due in England from April 2028. Reports suggest the Government has ruled out lowering the £2m threshold to £1.5m.
💼 £1m pension — From April 2027, most unused pension funds and relevant death benefits will form part of the estate for inheritance-tax purposes. Already legislated.
📈 £1m in ISAs — No overall cap on accumulated ISA wealth has been announced. Income and gains remain sheltered from UK tax within the ISA, although ISA assets are not automatically exempt from inheritance tax.
💰 £1m taxable investment portfolio — Exposure depends on capital gains, dividend income, available allowances and reliefs. CGT rate increases have reportedly been ruled out for this Budget.
Same £5m net worth. Four different tax treatments.
So where might the Chancellor still have room to manoeuvre on 28 October?
Potential areas include CGT allowances and reliefs, property taxation, inheritance-tax reliefs and bank taxation.
The Prime Minister has previously indicated a willingness to revisit agricultural inheritance-tax relief. No further Budget decision has been confirmed.
Meanwhile, reports suggest the bank corporation-tax surcharge could rise from 3% to 8%. Again, not yet confirmed.
An annual wealth tax would raise difficult questions about valuation, liquidity, administration and behavioural responses. A broad land value tax also appears unlikely in this Budget.
The important distinction isn't simply between being wealthy and not being wealthy. It's between different assets, ownership structures and tax rules.
Headlines about "taxing wealth" can obscure more than they explain.
What matters is which pot — and which rule.
General information only. Not personal tax or financial advice.
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