Glass-shattering £40bn budget debut from chancellor

Rachel Reeves delivered the inaugural budget from a female chancellor, representing Labour's first in fourteen years. The budget included a package of tax rises totalling approximately £40 billion, aimed at addressing what the government described as a significant shortfall in public finances.

Key measures

Among the headline measures were increases to employers' National Insurance contributions, changes to capital gains tax rates, and reforms to inheritance tax reliefs affecting business and agricultural property. The budget also confirmed changes to the non-domicile tax regime.

Impact on businesses

The increase in employers' National Insurance contributions will affect businesses of all sizes. Employers should review their payroll costs and consider the impact on recruitment and wage growth. The changes to capital gains tax rates will be relevant to business owners considering the sale of their business or the disposal of business assets.

Impact on individuals

For individuals, the changes to inheritance tax reliefs are significant. Business Property Relief and Agricultural Property Relief, which have historically provided full relief from inheritance tax for qualifying assets, will be reformed. From April 2026, the 100% relief will be capped, with excess values attracting a reduced rate of relief.

If you would like advice on how the budget changes may affect your personal or business finances, please contact our team.

This is not legal advice; it is intended to provide information of general interest about current legal issues.