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Millions of people are being urged to take action after Rachel Reeves’ budget sparked what one expert has called a “tax tsunami”. The Government has confirmed \u00a326bn worth of tax rises, hitting savers, workers and investors across the country.<\/p>\n
But while these changes will impact families from every angle, financial experts say there are still ways to keep your money safe if you act early. Laura Suter, director of personal finance at AJ Bell, said the budget has left many people worried about their income and savings. He said: “The Chancellor passed a \u00a326 billion tax increase on the public, with the vast majority of it landing at the feet of savers, investors and workers.”<\/p>\n
He added: “While there is no doubt that tax increases are looming, there are smart ways to mitigate the impact of this tax tsunami. Taking smart steps before some of the changes take effect, as well as making the most of remaining tax breaks, will put you in a good financial position to weather this storm.”<\/p>\n
Below are 9 ways to beat the budget “tax tsunami.”<\/p>\n<\/div>\n
Read more:<\/strong> Households paying Britain’s ‘most hated tax’ could double by 2031 <\/p>\n Read more:<\/strong> Nightmare for Rachel Reeves as house prices fall on budget speculation <\/p>\n<\/div>\n Rachel Reeves’ budget introduced what one expert called a ‘tax tsunami’ (Image: Getty)<\/span><\/span><\/div>\n Many employees rely on salary sacrifice to increase their pension contributions. From April 2029, National Insurance savings will be capped at \u00a32,000 a year, but Laura warned people not to panic.<\/p>\n She said: “Whatever you do, don’t stop your pension contributions. Even though National Insurance savings are limited, the money you pay in will still be free from income tax and workers can still enjoy pension tax relief up to the marginal rate of income tax.”<\/p>\n He said pension payments still reduce your “adjusted net income,” which could push people out of higher rate taxes or other costly tax traps.<\/p>\n Income tax bands will now remain fixed until 2031, putting more people in higher tax brackets as wages rise.<\/p>\n Laura said: \u201cMore people will be pushed into the next tax bracket and as their wages rise, the tax hit on their income will be greater than what they would have otherwise had.\u201d<\/p>\n They warned that key limits, including the \u00a360,000 child benefit clawback and the \u00a3100,000 personal allowance withdrawal, create punitive tax rates of up to 62% after National Insurance is included.<\/p>\n His advice is simple: use pension contributions to bring income below that limit. She said: \u201cThere will be a little extra administration involved but it will still be worth it when you consider the potential tax savings on offer.\u201d<\/p>\n<\/div>\nDon’t ignore salary sacrifice<\/strong><\/h3>\n
eliminate frozen tax allowances<\/strong><\/h3>\n