Tax rises are coming — and UK asset holders must act now 

The question is no longer if taxes will rise in the UK, but how quickly and how sharply, warns the CEO of one of the world’s largest independent financial advisory and asset management organisations.

Nigel Green of deVere Group is speaking out after reports that Chancellor Rachel Reeves is facing a £41 billion fiscal gap.

He says: “Growth is sluggish, borrowing is maxed out, and Labour has boxed itself in with spending promises and strict fiscal rules. This means tax hikes or spending cuts – or indeed – both are now seemingly inevitable.

“This is the moment for anyone with UK assets to stop waiting and start acting.

“The Treasury can be expected to go after capital, property, investment income — because that’s where the money is.”

The warning comes as the National Institute of Economic and Social Research confirms that the Chancellor’s budget leeway is wafer-thin.

With just £9.9 billion in headroom and growth forecast at a weak 1.3%, even a minor economic wobble could trigger emergency measures.

Inflation remains above target, the global outlook is volatile, and the government has already ruled out deeper spending cuts.

“We’re talking about very real, very targeted moves on people with portfolios, pensions, business assets and property.”

Despite Labour’s promise not to raise income tax on ‘working people,’ ministers have been careful with the language — and the definition.

This leaves scope for significant moves on capital gains tax, dividend income, inheritance thresholds and so-called ‘wealth loopholes.’

“This is where the money will come from and not just for the shortfall, but to fund public services and keep the bond markets happy,” Nigel Green says.

The squeeze is already being felt. New data from NIESR shows the UK’s poorest households have seen living standards fall since the election, down 1.3% since July and still far below pre-pandemic levels, which is fuelling pressure on the government to act quickly and to be seen to act fairly.

“When governments feel cornered, they move fast,” says the deVere Group chief executive. “The people who protect their wealth are the ones who plan early.”

He warns that any tax changes announced in the Autumn Statement could come into force quickly. The smart money, he says, is already asking the right questions — reviewing asset locations, rebalancing portfolios, exploring cross-border options, and examining trusts and succession plans.

“Everything needs to be on the table. If your strategy was built for a lower tax environment, it needs revisiting,” he adds.

With both political parties now committed to fiscal rules that constrain borrowing, and the cost of servicing the national debt growing, taxation will increasingly become the default mechanism for plugging gaps.

“We are entering a higher-tax era. That’s the reality,” Green says. “You cannot rely on old assumptions, and you cannot afford to sit this out.”

He believes those who act in the coming weeks — before the autumn Budget — will be in the strongest position to manage, mitigate and ultimately grow their wealth under new conditions.

“The direction of travel is clear. The Treasury will come for capital. It always does. The question is whether you’ve prepared.”