UK wealthiest brace for tax hikes as Budget rumours swirl, Saltus finds

A majority of the United Kingdom’s wealthiest households expect new taxes in the coming year as rumours swirl ahead of the autumn Budget, according to the Saltus Wealth Index. The bi-annual survey, based on more than 2,000 adults with investable assets of at least £250,000, finds 78% anticipate tax hikes over the next 12 months and 46% expect capital gains tax to rise in that period.

The index also shows a rise in overall sentiment: the Saltus barometer climbed to 64.7 from 58.2 in February, a period marked by the Labour government’s first Budget. Yet even with some improvement, confidence in the economy remains among the second-lowest readings in Saltus’ history as inflation persists and traders weigh the implications of potential policy changes. inflation currently sits at 3.8%, and almost half of high-net-worth individuals say tax changes are the biggest risk to their wealth, second only to inflation.

Among the tax changes most feared by the wealthy is capital gains tax. Some 46% of respondents expect CGT to rise in the next year, with the annual tax-free allowance for gains slashed from £12,300 to £3,000 in recent years. Basic-rate taxpayers now pay CGT at 18% (up from 10%), while higher- and additional-rate taxpayers pay 24% (up from 20%). Campaigners have pressed for CGT rates to align with income tax bands, a move that remains a topic of political debate.

In addition, the survey finds substantial concern around income tax and inheritance tax. About two in five wealthy families believe the Exchequer will breach Labour’s pre-election pledge not to raise income tax, and they are bracing for higher rates in the coming year. Inheritance tax is also seen as ripe for reform, with the threshold for IHT set at £325,000, and couples able to double that through planning. The nil-rate band for the family home adds a further layer of complexity, with the potential to leave a combined tax-free legacy of up to £1 million for some couples. Roughly 46% think the rate on IHT will rise, and 47% expect the nil-rate band to be frozen.

These developments have pushed high-net-worth families to seek greater protection for their estates. Many are turning to wealth-preservation strategies such as trusts, gifting and structured estate planning to shield legacies from potential tax changes. Mike Stimpson, a partner at Saltus, notes that while some respondents feel more prosperous, they do not feel more secure given the uncertainty surrounding the Budget and the Labour government’s broader plans. He says these households are the wealth creators and investors whose actions can influence broader economic trajectories.

Confidence in the economy has improved from 48% in February to 66% in August, but Saltus cautions that the improvement is a rebound rather than a restoration of confidence to pre-Budget levels. Dr Michael Peacey of the University of Bristol’s economics department, who compiles the index, points to a mixed backdrop: modest GDP growth and real wage gains have emerged alongside persistent inflation, geopolitical uncertainty and the specter of further tax rises in the November 2025 Budget. Nearly one-fifth of wealthy families remain unconfident, and 5% say they are extremely unconfident about the outlook.

The political dimension is evident in the voting data. Of the nation’s wealthiest, 49% voted Labour at the last election, yet almost half of these voters express regret over that choice. The principal reasons cited are underperformance of the economy and underinvestment in healthcare, with the sweeping changes to IHT named as a contributing factor to shifting sentiment. In particular, changes to pensions treated as IHT-relatable assets have raised questions about retirement planning and the ability to leave a substantial tax-free legacy to family, especially as reforms announced by the Chancellor raise the stakes for pension pots and property reliefs.

For many families with children, private schooling remains a non-negotiable expense, and the Saltus findings show nine in ten households with children send their kids to private schools. Some 71% say they have already made or will make sacrifices to accommodate fee increases, a trend that interacts with broader tax considerations and potential state-aid shifts. The Chancellor’s changes to IHT pensions and related reliefs, along with VAT treatment on private school fees, have prompted several families to consider relocating abroad as a hedge against higher tax exposure. Up to a quarter of respondents have considered leaving the UK, with Brexit cited as one reason by roughly one in five. Another 16% point to IHT changes as a driver for relocation.

The broader implications for business and markets hinge on how households respond to tax policy and the certainty they can rely on in a volatile global environment. If confidence remains fragile and uncertainty about future tax changes persists, wealthier households may adjust their investment and philanthropic plans, potentially affecting savings rates, capital formation and job creation. The Saltus index continues to monitor these dynamics in a period of fiscal transition, as policy makers weigh revenue needs against growth and national competitiveness.

As autumn Budget debates intensify, advisers say high-net-worth families will press for clarity and predictable rules that support long-range planning. Wealth-protection strategies are likely to remain an active area of focus as families seek to balance legacy objectives with evolving tax regimes. With the economy showing a tentative rebound but the shadow of policy risk lingering, the actions of the wealthiest households will be a meaningful signal for investors and policymakers alike.

Looking ahead, the Saltus team emphasizes that the coming months will test the resilience of the wealth management sector as it helps clients navigate a tax policy environment that remains unsettled. While some positive trends in growth and real incomes have emerged, the risk of further tax changes and the potential for policy missteps to undermine confidence remain central to the outlook for the UK’s wealthiest households. The Saltus index will continue to track whether the current uptick in sentiment proves durable or proves temporary as the Budget process unfolds.