Accountants cash in on Chancellor’s Budget gloom

The doom and gloom poured forth by Rachel Reeves may have hit confidence ahead of the Budget – but it has proved a boon for accountants.

Figures from the Office for National Statistics (ONS) showed that a rush by firms and households for advice ahead of the likely tax hikes was one of the key drivers of the economy over the summer.

The ONS said gross domestic product (GDP) increased by 0.2 per cent in August after two months of stagnation. 

Some experts said it would have been stronger were it not for the Chancellor talking down the economy and threatening tax hikes.

But half the growth came from so-called ‘professional, scientific and technical’ activities.

Much of that was due to 4.3 per cent increase in output from ‘accounting, bookkeeping and auditing’. That contributed 0.05 percentage points or about a quarter of the monthly growth.

Ashley Webb, UK economist at Capital Economics, said: ‘That may have been due to people and businesses arranging their financial affairs ahead of possible tax rises in the Budget.’

Reeves’s warnings of tax rises have fuelled fears she will target capital gains tax (CGT), pensions or inheritance tax. 

A CGT hike could hit owners of second homes or other UK assets. And the possibility that the tax-free lump cap on withdrawals from pension pots may be reduced has also prompted savers to seek advice.

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