Phillip Hammond holding the budget briefcase in front of number 10


Budget 2018

NFU Mutual Chartered Financial Planner Sean McCann considers this year’s Budget

From a personal finance perspective, the 2018 Budget was noteworthy more for the things the Chancellor didn’t say rather than the things he did.

The fact there was no further tinkering with pensions after the major changes of recent years will come as a relief to many. Those of us saving for our futures by investing in pensions will welcome a period of stability where we can plan our finances with confidence without any changes to the rules.

It was surprising that there was no move by Philip Hammond to address the complexities around Inheritance Tax (IHT). The Budget Report reveals that this tax year alone IHT receipts are set to hit a record £5.5bn before rising by a third to £6.9bn by 2023-24.

However, a report is due this autumn from the Office of Tax Simplification — hopefully this review will result in positive changes to simplify this deeply unpopular tax.

While this Budget may have been billed as one for hard-working families, they had better take the Chancellor’s advice and ‘plan for all scenarios’.

Key announcements for your personal finances


  • Lifetime Allowance (the amount you can accumulate in your pension over your lifetime without facing a tax charge) to rise from £1.03m to £1.055m from April 2019
  • Government to publish a paper in the winter setting out plans to increase pension participation by the self-employed.


  • ISA limit to remain at £20,000 for 2019/20
  • Junior ISA limit to increase to £4,368.

Income Tax

  • Personal allowance (the amount of income you can earn before paying tax) to rise to £12,500 from April 2019 – currently £11,850
  • The 40% tax rate will not kick in until your income exceeds £50,000.

Inheritance Tax

  • No announcements on IHT but a report from Office for Tax Simplification on IHT due in the autumn.

Capital Gains Tax

The Chancellor has tightened the rules around Entrepreneurs’ Relief, which allows up to £10million of gains to be taxed at a lower rate of 10%. Among other changes, the minimum qualifying period will increase from 12 to 24 months from April 2019.

The Government is also consulting on changes to ‘lettings relief’, which can reduce Capital Gains Tax on the sale of a let property which was once the owner’s main residence.

These changes will contribute to the growing Capital Gains Tax receipts which the Treasury anticipates will total £12.5bn by 2023-24 — a 60% increase from this year.

Self-catering holiday accommodation

The Government is to consult on the criteria under which self-catering and holiday lets become chargeable to council tax rather than business rates.

Speak to one of our NFU Mutual Advisers today, to see what impact the 2018 Budget has had on you.

Watch our rural affairs expert discuss Budget 2018