Reeves must resist tax raid on pensioners in UK’s November Budget 

A tax raid on pensioners is expected in the November Budget and individuals are urged to seek professional advice immediately to protect retirement savings through legitimate, government-approved strategies.

It comes after an influential thinktank has proposed a two-pence rise in income tax matched by a two-pence cut in national insurance, claiming it would raise around £6 billion and create a fairer system for workers.

Nigel Green, chief executive of deVere Group, issues the warning as pressure builds on Chancellor Rachel Reeves to raise revenue amid ballooning government borrowing and weak economic growth.

“The UK’s public finances are deteriorating at speed and history shows that when the Treasury faces a fiscal crunch, pensioners are treated as low-hanging fruit,” he says. “From post-war retrenchment to the stealth pension taxes of the 1990s and the allowance freezes of the past decade, successive governments have repeatedly tapped retirement savings to fill the gap. They typically see pensions as ‘low hanging fruit’, and there’s every reason to expect a repeat in November.”

Nigel Green counters: “Measures framed as levelling the playing field often fall hardest on retirees and landlords who rely on savings and investment income. Such a shift would push many pensioners into higher tax brackets at a time when living costs remain stubbornly high.”

Official figures reveal government borrowing running well above forecasts as debt-service costs surge. “Servicing the national debt is already swallowing tens of billions more than anticipated because interest rates remain elevated,” he explains. “This financial reality makes a raid on retirement funds an almost irresistible option for any chancellor seeking to finance spending pledges while avoiding headline tax hikes on the working population.”

Treasury ministers have refused to rule out tax increases when questioned, repeatedly deferring to the 26 November Budget statement. Nigel Green observes: “When senior officials decline to provide assurances, the direction of travel is clear. Pensioners should assume that new or higher taxes on their savings are firmly on the table.”

He urges immediate action: “Delaying until after the Budget would be a costly mistake. There are legitimate, fully compliant strategies to mitigate exposure, including maximising existing allowances before they are reduced, restructuring investment portfolios for greater tax efficiency, and exploring international options where appropriate.” Professional advice is essential to ensure these steps are tailored to individual circumstances and remain aligned with evolving regulations.

Nigel Green also warns of wider economic consequences. “Heavy taxation of pension savings undermines confidence, discourages long-term investment and sends a damaging signal to younger generations about the value of disciplined saving,” he says. “If the government wants to stimulate sustainable growth, discouraging retirement planning is precisely the wrong move.”

More people investing in pensions must be encouraged, he notes. “Pensions direct vital capital into industry and reduce future dependence on the state. Robbing people’s futures is no solution to today’s fiscal challenges.”

He concludes: “The combination of rising debt costs, weak growth and ambitious spending commitments creates a perfect storm. Pensioners are squarely in the firing line in what now appears to be an unavoidable assault on people’s hard-earned retirement funds.”