Savings and property income will be taxed more heavily than earnings

Commenting on savings and property rates announced in today’s Budget, Rachel McEleney, tax director at Deloitte UK, said: 

“Non-zero rates of income tax on savings and property income will increase by 4% from 6 April 2027, a doubling of the 2% increase that has already been legislated. This is effectively a 4% income tax surcharge on these types of income compared to earnings or pensions. 

“These changes are expected to raise £4.3bn by 2031/32, which is in addition to the £8bn last year’s measures were set to raise. These do not breach the government’s manifesto commitments, as they are separate from the standard basic, higher, and additional tax rates. The previously announced 2% increase was intended to level the playing field with the earnings of those below state pension age, which would normally attract 2% national insurance in addition to income tax. The increase announced today will generally result in savings and property income being taxed more heavily than earnings.”

ENDS

Note to editors

Deloitte spokespeople

Deloitte has a range of spokespeople available to comment on today’s Budget. They can be reached on 02920 927541 or one of the following numbers: 

• Amanda Tickel – head of tax and trade policy (+44 7920 270964)
• Debo De – chief economist (+44 7887 629107)
• Rachel McEleney – personal tax (+44 7774 337581)
• Alison Lobb – corporate tax (+44 7774 337581)
• Michael Nicolaides – employment tax (+44 7586 511104)
• Toby Price – stamp duty (+44 7824 895798)
• Andrew Clarke – VAT (+44 7887 629107)
• Chris Baldwin – business rates (+44 7785 682226)
• Ed Roddis – public sector (+44 7785 682226)
• Peter Johnson – FS/bank tax (+44 7586 511104)
• Annis Lampard – private tax (+44 7824 895798)
• Richard Bray – Places (+447990434703)
• Ian Goodsell – Private client (+447990434703)

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