Month: July 2024

More businesses hope for the best whilst moving with the times
As Sir Keir Starmer settles into life at Number 10, the country’s business owners’ wait with bated breath to see if reform will bring positive news to regenerate the economy, the skills and the high street.
I’ve heard from more businesses who are keen to share their views …
Will reform reach the British Business Bank?
Theo Chatha, Chief Financial Officer at Bibby Financial Services shared their opinion on the importance of Labour delivering on their promise of the much needed reform of the British Business Bank and the Bank Referral Scheme:
‘The Labour party now has an opportunity to drive economic growth through the UK’s resilient small and medium sized business community, and to support them in boosting output. But first, they must address key areas of concerns for SMEs, and access to finance is an area that requires attention.
‘We know that for many SMEs, high street banks remain the first and only port of call, so there’s a strong opportunity for Labour to increase competition in the commercial lending sector and to enable SMEs to access a wider range of options.
‘That’s why we were encouraged to see Labour commit to strengthening the British Business Bank’s Bank Referral Scheme in January. But clearly, more still needs to be done to make it work effectively. Despite much effort from the British Business Bank and the designated platforms and lenders, the number of businesses the scheme has supported since its launch in 2016 has been hugely disappointing.
‘We would urge this government to develop a new scheme that includes input from a wider array of SME funders and commercial finance brokers, to ensure that the initiative delivers for SMEs. This would ensure Labour gives SMEs more choice and agency over how they finance themselves to grow and thrive.’
Pushing talent in Britain
Keen to mobilise access to British talent and upskill more people to get into work, Michael Stull, Managing Director, ManpowerGroup UK, said:
‘After six weeks of pledges and promises from all parties, the people have spoken. We’d like to extend congratulations to Sir Keir Starmer and his Labour colleagues for securing a majority in the election.
‘ManpowerGroup has long been calling for a people-first approach to securing future prosperity for our country and to unlock the potential of its people. As millions nationwide are currently unable to either find, access or participate in work, we look forward to engaging with relevant Ministers across the new government as Labour implements the initiatives outlined in its Plan to Make Work Pay paper.
‘Better skills, leading to better quality jobs that provide sustainable earning potential, work-life balance, and wellbeing – done in ways that can be equitably accessed and shared by all – are, in our view, what’s needed to deliver a more inclusive and dynamic labour market. Under Labour’s new leadership, the UK’s transition towards the new-look economy of the future is a priority that we and others are eager to explore.’
Decisive election result a golden opportunity to plant the seeds of small business growth
Responding to the result of the General Election, Policy Chair of the Federation of Small Businesses (FSB), Tina McKenzie, said:
‘Congratulations to the new Prime Minister and Government on their decisive election victory, and congratulations to the newly elected MPs from all parties. The clear result of the General Election gives hope that political stability can lead to economic stability and recovery.
‘There’s a golden chance in the first 100 days of this new administration to plant the seeds of small business growth, and there are a range of policies FSB hopes the new Government will bring forward.
‘These include measures to ease the cost of doing business and support investment and expansion. From tackling poor payment practices by big businesses to their smaller suppliers to reforming the not-fit-for-purpose business rates system.
‘The upcoming King’s Speech should include a Small Business Bill to enshrine in legislation much-needed changes to better support small firms and the self-employed.
‘Supporting and growing small businesses is good for jobs, good for communities in all parts of the country, and good for the whole economy.
‘We’re looking forward to getting down to business and working in partnership with the new Government ministers and their teams – building on how we’ve engaged constructively with them in Opposition. This will ensure that the small business voice is heard clearly and the right actions can be taken to support existing entrepreneurs and encourage new ones.’
Business finance expert George Holmes reflects on how the result could affect startups and SMEs.
As MD of business funding specialists Aurora Capital he said: ‘The incoming Labour government has emphasised its commitment to supporting UK businesses and startups throughout the election campaign, and now all eyes are on them to fulfil these promises.
‘Labour’s manifesto includes encouraging plans for startups and SMEs, but the details of their implementation remain to be seen. The proposed reform of the British Business Bank is particularly welcome, as it promises to help startups and small businesses access much-needed funding. While this is a positive step, the specifics of these reforms are not yet clear.
‘For aspiring shop owners, the upcoming business rate reform could help them turn their dreams into reality. High business rates have long priced new businesses out of our high streets, and these changes could help reverse this trend.
‘For startups and small businesses to thrive, they need support, stability, and a growing economy. If the new government delivers on its promises, we could see a positive environment in which SMEs and entrepreneurs can flourish. However, as always, the devil is in the details, and we await further information on how these promises will be realised.’
Prioritising EV to power the motor industry is vital
A focus on electrification and investment in the UK motor industry should be among the priorities of the new Labour government, says the Vehicle Remarketing Association (VRA)
Philip Nothard, chair at the trade body, said that while it was clear that the administration wouldn’t have large sums of money to spend, it should be concentrated in areas that produce the best results.
‘The Labour message throughout their campaign and really for the last 2-3 years has been all about investment and growth, and we believe that two of the key areas that would best respond to funding are electrification and motor manufacturing.
‘We’d like to see measures to support the transition to electrification through both an acceleration of the creation of charging infrastructure – especially on urban streets – and direct help for people who want to buy a used EV.
‘It’s pretty clear that the used EV market is not yet functioning in anything approaching a normal manner and this really needs to start happening if the government is serious about its approach to zero emissions.
‘Also, we need to see more investment for manufacturers who are switching to EVs over this decade. The levels of competition in the market are ferocious, and car and van makers operating in the UK will need support to compete successfully.’
Philip added that the VRA was also interested in what the new government would do to enable training within remarketing and across wider industry.
‘Like other sectors, we are facing skills shortages and we’d like to see more done to help us attract and train the people that we need for the future. This is a problem that will affect the development of the industry going forward and needs attention.
‘We appreciate that all of these measures are probably not high on the agenda for the new administration or part of their ‘first 100 days’ plan to hit the ground running. However, they are priority areas that need attention for remarketing to succeed and where we’d like to know about the new government’s plans as soon as possible.’
Home charging is crucial over the next few years …
Cord, Halfords’ exclusive charger installing partner, believes encouraging home charging is crucial, as the financial benefits of EV ownership are essentially wiped out if drivers rely on public charging.
The average driver would spend an extra £92-£138 a month relying on public charging, obliterating any savings over petrol or diesel. Removing the VAT on public charging would only partially address this imbalance.
Cord co-founder Paul Tomlinson commented: ‘Labour’s commitment to greening the country’s fleet is admirable. But for these targets to turn into action we have make EVs a natural and affordable choice for drivers, not a luxury available to the few. The best way to do that is to make sure that as many people as possible can access home charging, which is by far the cheapest way to drive. Off-peak tariffs can make driving cost just £17 a month – around the cost of a premium Netflix subscription. But relying on public charging rockets that up to well over £100.
‘Getting every house hooked up with a home charger won’t be easy, as about a third of homes don’t have off-street parking. But there are millions of properties that could have a charger right now that don’t. Eliminating VAT on these crucial bits of tech and making clear that every tenant can install them if they want would go a long way to changing that.
‘Finally – it is absolutely crucial that we also bring down the cost of buying an EV in the first place. The UK should embrace the freedom leaving the European Union has given us and not place hefty tariffs on Chinese EVs, which are finally reaching price parity with fossil fuel equivalents. The 2030 ban will fall down in flames if EVs are still a luxury choice.’
EV cars are heavier so improving Britain’s roads is more critical than ever
IAM RoadSmart is the UK’s largest road safety charity providing advanced driving and motorcyclist training. It has a vision of a society where all road users can safely and sustainably use the public highways together. IAM RoadSmart was formed in March 1956 and has around 75,000 members that supports its campaigns on road safety. At any one time there are over 7,000 drivers and riders actively engaged with IAM RoadSmart’s courses.
IAM RoadSmart Policy and Standards Director Nicholas Lyes said: ‘IAM RoadSmart welcomes the new Government and Ministers to their positions. Doubtless to say, there are plenty of issues that need to be addressed: Motorists are dealing with pothole-plagued roads, expensive pump prices, soaring insurance premiums and worse, progress on reducing serious and fatal road collisions has stalled for many years.
‘Work must urgently begin to create safer, more affordable roads for all, with a focus on introducing a form of Graduated Driving Licences for new drivers, which has reduced fatalities in other countries. With road traffic crashes being one of the leading causes of death among the under-25s, it’s clear that road safety needs to be top of the agenda.’
Let’s unleash the power of small businesses
Finally, as a business title it would only be appropriate to end our 2024 election comments on a small business note. Amanda Powell-Smith, CEO of Forster Communications and UN Global Compact Network UK Sustainable Development Goal Pioneer, SMEs, 2024 made the most relevant comment:
‘We need change and we voted for it. As a new Prime Minister enters Number 10, the focus is on action and delivery – and small businesses can help.
‘Amid intense discussion on policy and the City, the role of SMEs as pioneers is too often forgotten. There are over 5.6 million SMEs in the UK, accounting for around three-fifths of employment and half of turnover in the UK private sector – and I am proud to lead one of them.
‘We need our size to be recognised as a superpower, enabling agility, flexibility and freedom to quickly respond to the opportunities found in new business models and solutions that work for both people and planet.
‘There are already multiple examples of SMEs taking the lead on innovation and social entrepreneurship in the UK, but they are often hidden from sight. Globally, the social innovation sector is more than twice the size of the $875 billion advertising industry and larger than the $1.57 trillion fashion industry, with one in two of these purpose-led businesses run by women.
‘As we seek to build a new economy, one that addresses climate change and drives social justice, we must maximise the knowledge and ideas of small business leaders who are at the heart of their communities. Armed with experience and insights they are uniquely placed to devise new solutions that are relevant and work.’
Read more:
Business owners share opinions and look to the future after Labour’s win

Dyson, the renowned technology company founded by Sir James Dyson, is set to cut nearly a third of its British workforce in response to intense market competition.
The company announced on Tuesday that it plans to lay off approximately 1,000 of its 3,500 UK-based employees.
Hanno Kirner, Dyson’s chief executive, described the redundancies as “painful” but necessary following a global operational review initiated earlier this year. This review, which began before the general election was called in May, is not connected to the policies of the new Labour government.
The job cuts come in the wake of Dyson’s decision to discontinue its electric car project and the launch of its controversial Zone Absolute headphones. These noise-cancelling, air-purifying headphones, featuring a mask that covers the mouth, were initially priced at £819.99 but have since been reduced to £579.99.
Dyson Ltd, the UK branch of the company known for its bagless vacuum cleaners, hair dryers, and heaters, experienced a 10% drop in sales to £376 million in 2022. Despite this, global sales increased from £6 billion to £6.5 billion in the same year, with revenues hitting £7.1 billion the following year, even amid challenges like the closure of its Russian operations and supply chain disruptions.
It remains unclear if the job cuts will affect Dyson’s international operations, including its 2,000 employees in Singapore. The UK job reductions will impact Dyson’s campus in Malmesbury, Wiltshire, which will continue to serve as a major research site and home to the Dyson Institute.
In a statement, Kirner said, “We have grown quickly and, like all companies, we review our global structures from time to time to ensure we are prepared for the future. Dyson operates in increasingly fierce and competitive global markets, in which the pace of innovation and change is only accelerating. We know we always need to be entrepreneurial and agile – principles that are not new to Dyson.”
He acknowledged the difficulty of the decision, adding, “Decisions which impact close and talented colleagues are always incredibly painful. Those whose roles are at risk of redundancy as a result of the proposals will be supported through the process.”
The announcement follows Sir James Dyson’s recent criticism of the former Conservative government’s economic policies. He accused the government of a “short-sighted” approach that hindered business growth, stating in The Telegraph that Dyson’s success was achieved “despite government, rather than because of it.”
Read more:
Dyson to cut nearly a third of its UK workforce

Americans residing and working in the UK might face increased tax rates due to outcomes from the UK general election and the US presidential election this November.
Alex Straight, a Partner at Blick Rothenberg, a British audit, tax, and business advisory firm, and spokesperson for the firm’s international group, highlighted, “For Americans, this is the warm-up ahead of the main event of the US election in November.”
He elaborated, “With Labour’s historic landslide victory, they’ve received a mandate to implement a long-term tax strategy. While their manifesto pledges to keep income tax, national insurance, VAT, and corporation taxes unchanged, the non-dom tax changes introduced by the previous Conservative Government and retained by Labour will significantly impact many Americans in the UK. Historically, the non-dom tax regime allowed many Americans in the UK to avoid tax liabilities on their non-UK income and gains. This will no longer typically be the case moving forward. Additionally, Labour has not committed to capital gains tax rates. Presently, the UK’s main capital gains tax rate is comparable to that of the US, but any increase or changes, especially concerning carried interest, will elevate the global effective tax rate for Americans in the UK.”
Straight continued, “To balance the books without major headline tax increases, growth is essential. We hope this is reflected in any proposed tax policy given Labour’s healthy majority. The UK has always been a favourable destination for Americans to live and work. However, while the UK enjoys a large majority government, a similar outcome in the US is less likely this November. This year, marked by elections and change, sees the first piece of the puzzle fitting into place. We should gain more clarity with the first UK Budget expected in September. The US election, however, promises to be much closer, bringing more uncertainty regarding the future US tax landscape and its effects on Americans in the UK.”
Read more:
Impending tax hike looms for Americans in the UK following general elections

In a decisive move to address the UK’s housing crisis, Rachel Reeves, the UK’s first female Chancellor of the Exchequer, has announced a series of ambitious measures aimed at revitalising the housing sector.
In her inaugural speech as Chancellor following Labour’s recent election victory, Reeves outlined her government’s commitment to building 1.5 million homes over the next five years, as promised in Labour’s election manifesto.
“We’re not in the business of reneging on our manifesto commitments,” Reeves declared. “We’ve received that strong mandate. We’re going to deliver on that mandate.”
Reeves detailed a comprehensive plan that includes the restoration of mandatory housebuilding targets, the construction of affordable and council homes, and the lifting of the onshore wind farm ban. Additionally, she introduced a new task force to accelerate stalled housing sites and support local authorities with 300 additional planning officers. The government also plans to review previously rejected planning applications that could benefit the economy and prioritize brownfield and greybelt land for development to meet housing targets.
Key points from Reeves’ announcement include:
Mandatory housebuilding targets: Reinstituting targets to ensure steady progress in housing construction.
Building 1.5 million homes: Aiming to complete this ambitious goal by the end of the current parliament.
Ending the onshore wind farm ban: Promoting sustainable energy as part of the housing strategy.
New task force: Accelerating development on stalled housing sites.
Support for local authorities: Adding 300 planning officers across the country.
Reviewing planning applications: Reassessing previously turned-down applications to bolster economic growth.
Prioritising development land: Focusing on brownfield and greybelt areas to meet housing needs.
Reforming the planning system: Streamlining processes to facilitate infrastructure development.
Policy intentions for critical infrastructure: Setting out future plans to support the housing and infrastructure sectors.
Industry Reactions
The announcement has been met with positive reactions from industry leaders who view it as a bold step toward economic growth and stability.
Stephen Phipson, Chief Executive of Make UK, praised the government’s clear and proactive approach. “Industry will welcome such a bold statement of intent which is a clear indication of a Government that has well and truly hit the ground running, especially in ensuring that key institutions are focused on promoting economic growth with their shoulders to the wheel,” he said. Phipson emphasized the need for a robust Industrial Strategy and tackling the skills crisis, particularly through a review of the Apprentice Levy and Technical Education system. He also highlighted the potential of modular homes built in British factories to meet housing targets.
Daniel Paterson, Director of Policy at Make UK Modular, echoed these sentiments, expressing eagerness to collaborate with the government on the ambitious building agenda. “The Labour Party laid out a bold plan during the run-up to and throughout the election campaign and we welcome the Chancellor’s statement today in regard to growth; making homes and infrastructure building central to this,” Paterson stated. He noted that the reinstatement of housing targets, new funding for planning officers, and overhauling the planning system were overdue but welcomed steps. Paterson also appreciated the planned consultation on the National Planning Policy Framework and the push for universal coverage for local plans as crucial to getting Britain building again.
Chancellor Rachel Reeves’ announcement marks a significant commitment to addressing the UK’s housing needs and stimulating economic growth. By setting ambitious housing targets, reforming planning systems, and fostering collaboration between government and industry, Reeves aims to deliver on Labour’s election promises and create a more stable, prosperous future for Britain. The business community’s positive reception of these plans underscores the potential for these measures to drive substantial progress in the housing sector and beyond.
Read more:
New Chancellor Rachel Reeves Announces Mandatory Housing Targets ‘To Get Britain Building Again’

In the fast-paced world of public relations, timing is everything. As someone who has spent years navigating the intricacies of media relations and crisis management, I cannot stress enough how critical speed is when it comes to getting your name featured in news stories.
This is particularly true in the context of events with immense public interest, such as the recent UK general election.
Why Speed Matters
When news breaks, journalists are on high alert, looking for fresh angles, expert opinions, and immediate reactions. The window of opportunity to provide these insights is often measured in minutes, not days. Sending a reaction comment four days after a major event is not just ineffective—it’s a colossal waste of time and resources.
Imagine this scenario: A significant political event unfolds, and your PR company drafts a perfect response. However, it sits in their inbox for days, only to be sent out when the news cycle has moved on. By then, the media has already published numerous stories and moved on to the next big thing. Your carefully crafted comment is now irrelevant, buried under a pile of newer updates.
The Financial Cost of Delays
For SMEs, every pound counts. Hiring a PR company can be a significant investment, but if they are slow to respond, you might as well take that money out to the car park and set fire to it. At least then, you’ll get some warmth in this unseasonable British summer. A delayed reaction not only fails to capitalise on the immediate news cycle but also wastes the budget allocated for timely PR interventions.
Actionable Advice for SMEs
Set Clear Expectations: Ensure that your PR company understands the importance of speed. Set clear guidelines for how quickly they need to respond to major events.
Prepare in Advance: Work with your PR team to prepare draft responses for various scenarios. Having pre-approved comments can save precious time when news breaks.
Stay Informed: Keep abreast of major news events, especially those relevant to your industry. This allows you to provide timely and relevant reactions.
Leverage Social Media: Sometimes, your official channels might be slower. Use social media platforms to share immediate reactions while your PR team crafts a more detailed response.
Evaluate Performance: Regularly review the performance of your PR company. If they consistently fail to deliver timely responses, it might be time to reconsider your partnership.
In the realm of public relations, particularly during high-stakes events like general elections, speed is not just an advantage—it’s a necessity. SMEs must ensure their PR companies are equipped to act swiftly and effectively. Delayed reactions are a waste of time and money, undermining the very purpose of engaging PR professionals. By prioritizing speed and setting clear expectations, SMEs can enhance their media presence and make the most of every opportunity.
Remember, in PR, being second is not an option. Be first, be fast, and make your mark.
Read more:
The Importance of Speed in PR: A Wake-Up Call for UK SMEs

Avon UK has named Sara Davies MBE, renowned entrepreneur and Dragons’ Den investor, as its new Chief Inspiration Officer.
The appointment aims to bolster efforts to help more women launch and grow their own businesses.
Tackling barriers to women’s entrepreneurship
Avon’s recent research reveals that nearly a third of British women face significant obstacles when starting their own businesses, including difficulties accessing finance, uncertainty about where to begin, and a lack of confidence. The study highlights that 33% of women feel the business landscape favours men, and 23% believe they have fewer opportunities compared to their male counterparts.
As Chief Inspiration Officer, Davies will host masterclasses and mentoring sessions to provide Avon Representatives (Reps) with the guidance and support needed to overcome these challenges. Her role is set to inspire and equip women to run their businesses effectively and confidently.
Davies’ mission
Sara expressed her enthusiasm for the role, stating, “I am thrilled to join Avon UK as its first Chief Inspiration Officer and to work with both budding and existing Avon Reps who have the hunger to build and run their own business, on their own terms. The research certainly chimes with many of the barriers I came up against when starting up my own business, and I know they persist today and can seem insurmountable.”
Sara’s top tips for budding entrepreneurs include:
Have a plan: Set clear goals and write them down to stay accountable.
Do your research: Connect with brands that align with your values.
Build a personal brand: Let customers buy into you, not just your products.
Use your support network: Seek advice and celebrate your successes.
Lead from the front: Consistency is key in inspiring and motivating your team.
Tailor your leadership style: Listen to your team’s needs and celebrate their achievements.
Avon’s continued commitment to women’s empowerment
For over 137 years, Avon has championed positive change for women, providing tools and resources to help them build successful businesses. Avon Reps enjoy the flexibility to earn on their own terms, with opportunities to become Leaders, recruiting and supporting their own teams.
Tracey Powers, UK Sales Director at Avon, remarked, “We need to do more to help women overcome the barriers they often face when setting out to start their own business and embracing a working pattern which works for them. Avon’s business model enables Reps to have greater choice, flexibility, and freedom to take control of their finances and realise their potential.”
Sara Davies, who founded Crafter’s Companion and became the youngest female investor on Dragons’ Den, is passionate about supporting women in business. Her involvement with Avon has already led to an 18% growth in sales for Reps attending her masterclasses, demonstrating her positive impact.
Reflecting on her journey, Sara added, “The world of work has changed. The rigid 9-5, which is notoriously difficult for mums, has been replaced by more flexible work and being an Avon Rep offers women the option to put the hours in whenever suits them. The country is filled with women from all walks of life with entrepreneurial flair and potential, so unlocking this would pay dividends for the economy and give it a much-needed boost.”
Read more:
Avon UK appoints Dragons’ Den star Sara Davies as chief inspiration officer

Amazon founder and executive chair Jeff Bezos is set to sell nearly $5 billion worth of shares in the e-commerce giant, according to a regulatory filing disclosed after market hours on Tuesday.
This announcement comes on the heels of Amazon’s stock reaching an all-time high of $200.43 during the trading session.
The proposed sale involves 25 million shares and follows a significant rally, with Amazon’s stock surging over 30% this year, far outpacing the 4% gain in the Dow Jones Industrial Average index. Post-sale, Bezos will still retain approximately 912 million Amazon shares, representing 8.8% of the outstanding stock.
This move is not unprecedented for Bezos; he sold shares worth around $8.5 billion in February, following an 80% stock rally in 2023. Amazon’s strong performance in the first quarter, buoyed by the artificial intelligence trend, contributed to this stock surge.
Currently ranked as the second-richest person globally with a net worth of $214.4 billion by Forbes, Bezos continues to diversify his ventures. He is also the founder of Blue Origin, a space exploration company that successfully launched a six-person crew to the edge of space in May.
Read more:
Jeff Bezos to divest $5bn of Amazon shares after stock reaches record high

Throughout the general election campaign, Labour officials maintained there were “no plans” to increase taxes beyond their stated manifesto pledges.
However, given the precarious state of the nation’s finances, the wealthy and their advisers anticipate future tax hikes now that the party has assumed control of Number 10.
Labour’s landslide victory was, in part, secured by pledging not to increase income tax, national insurance, VAT, or corporation tax rates — the “big four” taxes which account for about 75 per cent of the annual tax revenue.
This leaves limited flexibility if economic growth falls short of expectations. As a result, speculation about which tax levers might be pulled in the future has been a hot topic among advisers and their clients.
Predicting potential changes to tax rules is fraught with risk. However, higher earners and the wealthy are weighing the risks of pre-emptive action against the potential benefits of lower future tax bills if their strategies succeed.
Aside from relocating abroad, here are four ways the wealthiest are looking to “Labour-proof” their finances against possible future tax increases.
Restructuring your investment portfolio
Advisers suggest that changes to capital gains tax (CGT) could be a subtle way of imposing a wealth tax. Gains on investments held outside pensions and ISAs are currently taxed at 20 per cent: historically low for the UK and relatively low compared to the US and Europe.
Wealth managers report a sell-off has begun as some wealthy clients fear Labour will increase CGT rates, potentially aligning them with rates charged on dividends or income tax.
“We are seeing people taking action and rebasing their portfolios, selling assets now to crystallise gains at 20 per cent in the hope this will protect them from higher future tax rates,” says Katherine Waller, co-founder of Six Degrees, a wealth management firm.
Many of her clients, who are entrepreneurs, have large allowable tax losses to offset gains, making a pre-emptive CGT hit more palatable. Another strategy involves storing up any allowable losses for future use if CGT rates rise, although Waller fears Labour could impose a time limit on these. “It’s also possible that future capital losses will be capped,” she adds.
Christine Ross, client director at Handelsbanken Wealth, notes that her clients are also carefully reshuffling their investment portfolios. “They generally sell [a shareholding] and immediately purchase similar investments to bank the current capital gains tax rate,” she explains. “The shares must be different, as UK tax rules negate this form of planning if the same shares are repurchased within 30 days of sale.”
Investment platforms report that customers are selling shares held within general investment accounts and repurchasing them within ISAs, making use of their spouse’s £20,000 annual allowance alongside their own.
Advisers strive to ensure reconstructed investment portfolios maximise the whole family’s tax allowances, though this raises questions of control. Holding assets in the name of a spouse or civil partner in a lower income tax band can be advantageous — provided there is trust they won’t spend it.
The fear of future CGT increases is also adding to financial pressures on smaller buy-to-let landlords, prompting many to sell up. CGT is charged at 24 per cent for higher-rate taxpayers selling second homes or buy-to-let properties. Larger landlords, who often hold rental properties within corporate structures, are less affected. However, advisers say potential CGT changes could accelerate planned exit strategies and reduce investment levels, neither of which bodes well for a government aiming for growth.
Labour insists there are no plans to raise additional taxes. However, if any future CGT changes do occur, tax experts expect they will be implemented with little warning to avoid mass pre-emptive disposals. Meanwhile, asset owners spooked into selling are swelling the coffers, potentially delaying any reckoning.
The evolving role of pensions
The very wealthy often view their pensions as vehicles for intergenerational wealth transfer rather than for their own spending. Ending the favourable inheritance tax (IHT) treatment of defined contribution pensions could be an easy target in a future Budget, prompting advisers to think of mitigation strategies.
Pensions have previously been attractive targets for Labour chancellors. However, former pensions minister Sir Steve Webb believes that if Rachel Reeves, the new chancellor, has to target pensions, she will do so “with the minimum amount of hissing”.
Webb predicts she will avoid changes to tax-free lump sums, higher rate tax relief, or bringing forward increases to the state pension age — at least in Labour’s first term. Nevertheless, advisers say clients remain deeply concerned.
For over-55s planning to draw on their pensions, taking tax-free cash sooner rather than later might seem a tempting hedge against future rule changes. The maximum tax-free lump sum most people can take is capped at £268,275, equivalent to 25 per cent of the historic pensions lifetime allowance (LTA).
Anxiety levels rose two weeks before the election when Sir Keir Starmer mistakenly said the LTA would be scrapped in the future.
Financial advisers report that older clients with plans for their tax-free cash, such as paying down a mortgage or funding children’s property deposits, are most motivated to take their entire lump sum. However, they urge caution: withdrawing a quarter of a pension only to reinvest it in a general investment account risks future CGT bills and brings money within the estate for tax purposes.
Those with large pensions were relieved when Labour’s manifesto abandoned plans to reinstate the LTA. Scrapped by former chancellor Jeremy Hunt last March, Reeves initially promised to reinstate it if Labour were elected, only to drop it last month.
“That doesn’t mean it won’t happen in the future,” says Webb, now a partner at LCP, noting a general feeling within Labour that pensions tax relief is “too skewed towards the top”.
Since last March, advisers say some clients have opted to withdraw small sums to crystallise their pension benefits, fearing the LTA would be reinstated by Labour. “This is because, historically, changes to the rules have only affected uncrystallised pensions,” explains Adam Walkom, founder of Permanent Wealth Partners.
Much has been made of Reeves’s previous support for a flat rate of pensions tax relief, but Webb does not believe she would end higher rate tax relief of 40 per cent, especially as 3 million more workers are expected to be drawn into this tax band over the next five years. He expects Labour’s promised “pensions review” to focus on directing more institutional investment into British companies.
For now, workers in the “accumulation phase” can take advantage of the increased £60,000 annual allowance on pension contributions while it lasts. Even if Labour reduces this to £40,000, advisers do not anticipate changes before the April 2025 tax year.
With many already battling the effects of fiscal drag, making additional pension contributions to reduce income tax is an efficient strategy, especially for parents earning over £100,000 who could retain valuable childcare benefits when the system expands in September.
Accelerating your inheritance strategy
Advisers have long recommended “giving while living” to reduce inheritance tax bills and start the seven-year clock ticking on potentially exempt transfers. Political change has added urgency, with some wealthy families accelerating asset transfers to younger generations out of fear of changes to IHT under Labour.
“Many families who already intended to make substantial gifts to their children or to a trust are proceeding with their plans,” reports Ross.
Advisers worry that any future IHT rule changes could make it less advantageous to inherit a pension or remove business property relief on certain AIM-listed shares held for more than two years — a common, though risky, tactic to reduce IHT bills. The IFS estimates that removing these reliefs could raise nearly £3bn annually.
Ollie Saiman, co-founder of wealth manager Six Degrees, notes a growing interest in taking out insurance policies to hedge future IHT liabilities. “If you’re in your 50s or 60s and in good health, whole of life cover to provide liquidity for the eventual tax bill can be cost-effective,” he says. “Probate cannot be granted until IHT bills are paid, and beneficiaries inheriting a large, illiquid estate with a lot of property or carried interest may struggle to do so.”
Saiman also reports increased interest in setting up pensions for children and grandchildren. Up to £2,880 per year can be invested, topped up to £3,600 with 20 per cent tax relief, and cannot be accessed until retirement age. “Wealthy families understand the power of compounding,” he says.
Family investment companies are also becoming more popular. Family members become shareholders and can be paid dividends. “This could be a very tax-efficient way of covering university expenses for children or grandchildren, who will be subject to a low tax rate on their dividends,” Saiman adds.
The use of tax deferral vehicles such as offshore bond portfolios is also increasing. These are subject to the income tax rate of the recipient, making gifting a segment to a child at university a popular move. However, consider the upfront charges and advisory fees for setting up these structures.
Another simple way to avoid CGT bills on investments is to donate them to charity. Charities can dispose of shares free of capital gains tax. While they cannot claim Gift Aid on the value of the donation, individuals can offset the gross value of the gift against income tax, potentially solving two problems in one.
School fees — grandparents to the rescue?
Labour’s plans to apply VAT to private school fees were one of the few tax-raising measures consistently maintained throughout this year’s campaign.
Chancellor Rachel Reeves has stated that changes will not be introduced for boarding and day schools until next year, meaning they will not affect the beginning of the school
Read more:
Safeguarding your wealth: Strategies to navigate potential labour tax changes

The US economy added 206,000 jobs in June, signalling a slight cooling in the labour market, according to the latest data from the Bureau of Labor Statistics (BLS).
This figure aligns closely with economists’ expectations and represents a modest decline from the revised 218,000 jobs added in May.
June’s unemployment rate edged up to 4.1%, marking the first time in over two years that it has surpassed 4%. This 0.1% increase from May indicates a gradual easing in labour market conditions.
Earlier reports this week had already suggested a cooling trend. Payroll processor ADP reported that private sector employment grew by 150,000 jobs in June, down from 157,000 in May. Additionally, the executive outplacement firm Challenger, Gray & Christmas noted 48,786 job cuts in June, a reduction from May’s 63,816 but still a near 20% increase compared to June of the previous year.
The monthly jobs report, a key indicator for both Wall Street and policymakers in Washington, comes as the Biden administration faces challenges with public perception of its economic management. The labour market’s resilience has been a crucial counterpoint amid broader economic concerns.
These employment figures, alongside upcoming inflation data, will be pivotal for the Federal Reserve’s assessment of economic health and its interest rate strategy. The Fed maintained interest rates at a two-decade high of around 5.3% last month as it strives to bring inflation down to its 2% target. In May, inflation stood at 3.4%, significantly lower than its June 2022 peak of 9.1% but still above the Fed’s goal.
Minutes from the Fed’s last meeting, released on Wednesday, indicated a cautious approach, with officials awaiting “additional favourable data” before considering rate cuts. Fed Chair Jerome Powell remarked earlier this week on the progress made towards balancing the labour market, emphasising the need for confidence in sustainable inflation reduction.
The forthcoming inflation report for June, due on 11 July, and the Fed’s next meeting on 30 and 31 July, will be critical in shaping future monetary policy decisions.
Read more:
US economy adds 206,000 jobs in June as labour market shows signs of cooling