As we count down the days to this year’s UK Autumn Statement speculation continues
to grow about what Chancellor Jeremy Hunt will say in the House of Commons on
Wednesday 22 November. While personal tax cuts are unlikely due to fears of fuelling
inflation, slightly improved public finances mean that the Chancellor has an opportunity
to fund certain tax initiatives and spending. We break down what this means
What is the Autumn Statement and how does it affect my finances?
The UK Autumn Statement is when the Chancellor announces the government’s plans
for the economy to the House of Commons and the public based on the latest forecasts
from the Office for Budget Responsibility. It essentially includes an update on the state
of the country’s finances, including everything from wages, public services and benefits
to tax and spending, and it has a direct influence on the household budgets of millions
of people both in the country and investing from afar.
What is Stamp Duty Land Tax?
Stamp Duty Land Tax is a property tax paid by someone who purchases property or
land in England or Northern Ireland, and is based on the sum paid for the property or
land. Stamp Duty is charged at 5% between properties of £250,000 and £925,000,
starts at £425,000 for first-time buyers, and rises to 12% for properties exceeding £1.5
While tax cuts are unlikely in the Autumn Statement there is widespread speculation
that the Chancellor will increase the Stamp Duty threshold to stimulate a slowing UK
property market and support UK housing prices, similar to how changes were
implemented to help sustain the market during the Covid pandemic. If the Stamp Duty
thresholds are to be lifted as expected, it will mark an exciting opportunity for potential
buyers and investors looking to make a move in the UK property market.
What is UK Inheritance tax?
Another rumoured change on the way is that of the UK Inheritance Tax, despite the
Chancellor warning the public against tax cut expectations. Inheritance Tax is
essentially a tax on the estate of someone who has passed away and includes property, possessions and money. The standard Inheritance Tax rate is 40% but is only charged
above the tax-free threshold of an estate, which is currently £325,000, with an extra
£175,000 allowance towards a main property residence if it is passed to the children or
grandchildren of the deceased person. A married couple can share this allowance
between the two of them, meaning that they can pass on £1 million to their children
without any tax if they have planned their wills jointly and own the home together.
This anticipated ease on the tax would be good news for children and grandchildren of
those with estates as beneficiaries are the ones responsible for it.
What does this mean for me?
If these rumours prove to be true those looking to benefit from UK property and estates
could be given a window of opportunity not to be missed in the next few months. The
Chancellor had been expected to wait until the Spring Budget in March to introduce tax
cuts, but worse than expected growth projections allegedly encouraged him to
reconsider them for the Autumn Statement. With the UK economy largely expected to
suffer negative growth in the first quarter of next year, inflation predicted to rise, and the
Bank of England warning of potential recession in 2024, this window of opportunity
might be shorter than expected, making now the time to act on planned property
purchases and investments.
For those seeking any advice on all things UK property and investment related,
particularly with the exciting opportunities expected from the Autumn Statement, Tailor
My Property has an expert network of property, mortgage and finance professionals
who are able to advise and assist with a wide range of specialist queries.