- The government plans to raise the UK’s overall tax burden to a record level — by 2030–31, taxes will amount to roughly 38% of GDP.
- The freeze on personal income tax thresholds will be extended until 2030–31. This means many taxpayers’ incomes could be “bracket-crept” into higher tax bands over time.
- Major changes to pensions and savings: tax reliefs for “salary-sacrifice” pension contributions will be cut — the government estimates raising ~£4.7 billion in 2029–30 from this measure.
- The annual cash ISA allowance will be cut to £12,000 (for under-65s).
- A new “mansion-style” surcharge / higher-value property levy will hit UK properties valued over £2 million (from 2028).
- New levies and tax measures: includes increased taxes on dividends and savings, higher duties on gambling, levies on electric and hybrid vehicle use (3 p per mile from 2028), and other assorted tax rises targeting wealth/assets.
On the spending/benefits side: the Budget reverses the “two-child benefit cap” (restoring benefits for larger families), and invests more in public services, welfare and regional funding.
The government says the measures aim to balance “fair taxes, strong public services, and a stable economy,” while avoiding austerity.
What this means for UK expats living in the US (or with UK-linked assets / income / pensions)
As an expat, you may still have exposure to UK taxes or UK-resident assets — and some of these changes could meaningfully affect you. Key considerations:
- Pensions & retirement planning — The cap on salary-sacrifice pension reliefs reduces a tax-efficient route to build UK pension savings. For most expats retaining UK pensions, this in unlikely to have an impact as they are no longer contributing.
- Savings efficiency (ISA) — If you have UK cash ISAs, the reduced £12,000 limit (for under-65s) lowers the amount you can shelter UK tax-free. For those still UK-resident or with UK bank accounts, this matters.
- UK property holdings / UK residential real estate — If you own UK property valued above £2 million (or likely to reach that threshold), the new surcharge (“mansion-style levy”) could materially increase your tax burden.
- UK-source income (dividends, savings interest, etc.) — With increased taxes on dividends and savings returns, maintaining UK investments (or holding controlled companies) may now be less tax efficient.
- Lifetime tax exposure & asset structuring — Given the broader tilt toward wealth and asset-based taxes (not just income tax), expats with cross-border holdings (UK + US) should review how assets are structured to consider UK liabilities
In short: even if you live in the US, exposure to UK assets, pensions, properties or savings may require revisiting UK planning — the Budget makes UK tax-efficiency harder for anything tied to the UK.
Risks / What to watch
- For high-net-worth individuals with UK property, wealth or investments — the shift toward wealth/asset taxation (property surcharge, dividend/tax hikes) increases complexity and may lead to higher taxation or unexpected liabilities if not carefully planned.
- As UK tax policy tilts toward raising revenue on assets and wealth rather than broad-based consumption taxes, future budgets may bring further surprises — making periodic review essential.
Disclaimer: Some of the content of this communication was provided by third parties of Rosefinch. We have not verified the information contained herein, but we believe the content is reliable. None of this content should be construed as legal, accounting or tax advice. Many legal issues, accounting or tax regulations are complex and often have highly-individualized requirements, you should seek the advice of a competent professional if you have specific tax questions.
