The Spring Statement 2026 - no tax rises or policy changes for private clients

The Spring Statement was delivered to the UK Parliament yesterday (3 March 2026) by the Chancellor of the Exchequer, Rachel Reeves.

The Chancellor had previously pledged to hold only one “fiscal event” each year (at the Autumn Budget), and so the Spring Statement was widely expected to be a low-key affair. Whilst acknowledging the uncertain global economic landscape, the Chancellor also emphasised the importance of stability and confirmed that she would deliver on this promise.

However, whilst the Spring Statement did not feature any new tax rises or reforms for private clients, it is worth noting that an amendment paper published yesterday in respect of the Finance Bill currently making its way through Parliament proposes significant changes to the way in which offshore income gains (gains arising on the disposal of an interest in a non-reporting offshore fund) are taxed.  The reason for these changes is to ensure that the Temporary Repatriation Facility functions correctly in relation to offshore income gains; however, the changes will have wide-reaching implications.

Taxpayers should also not lose sight of other upcoming tax reforms, announced at the 2024 and 2025 Autumn Budgets. Key measures coming into force on 6 April 2026 include the following points.

• As reported in our previous article, significant reforms to agricultural property relief (APR) and business property relief (BPR) were announced in the 2024 Autumn Budget. From 6 April 2026, individuals (and trusts) will qualify for 100% APR or BPR up to a combined limit (for both reliefs) of £2.5m with any value of eligible business or agricultural property above this threshold qualifying for relief at 50%.

   

• Basic and higher dividend tax rates are set to increase by 2% from 6 April 2026; however, the additional rate for dividends is to remain unchanged at 39.35%. (Note also that property and savings income tax rates are due to increase by 2%; however, these tax rises will not take effect until 6 April 2027.)

   

• The rate of capital gains tax where Business Asset Disposal Relief (which reduces the capital gains tax rate on disposals of certain business assets) or Investors’ Relief (a similar relief applying to unlisted shares in an unquoted trading company) applies will increase from 14% to 18% with effect from 6 April 2026.

   

• A number of measures targeting tax avoidance, announced at the 2025 Autumn Budget, are due to come into force on 6 April 2026.
  • The “temporary non-residence rules” (designed to prevent individuals from becoming non-UK resident for a relatively brief period to reduce their UK tax exposure by imposing UK tax on certain income and gains when an individual returns to the UK) currently do not apply to distributions or dividends which relate to “post departure trade profits” (i.e. profits that accrue to a company after the individual left the UK). The exemption for “post departure trade profits” is to be removed from 6 April 2026, meaning that all distributions or dividends received from a company controlled by the individual whilst temporarily non-UK resident will be charged to UK income tax upon the individual’s return to the UK.
  • Under existing rules, all UK residential property is subject to inheritance tax, even where it is held (by a non-long-term UK resident) indirectly through a non-UK entity. From 6 April 2026, these rules will be extended so that UK agricultural land will always fall within the scope of inheritance tax, even where it is held through a non-UK entity.
  • The inheritance tax exemption applying to charitable gifts on death is to be restricted - from 6 April 2026, gifts made on death to trusts for charitable purposes (which do not meet a wider definition of charity, with certain jurisdiction, registration and management requirements) will not qualify for the inheritance tax exemption. (Note that this limitation also came into force in respect of lifetime charitable gifts with effect from 26 November 2025, the date of the 2025 Autumn Budget.)

Finally, it should be noted that the "Economic and fiscal outlook" report published yesterday by the Office for Budget Responsibility (OBR) acknowledged that the long-term fiscal outlook remains challenging. Expected GDP growth for 2026 is 1.1%, down from 1.5% in 2025, with the OBR noting that a number of factors (including the conflict in the Middle East and recent changes in US tariff policy) could have a significant impact on their forecast. Accordingly, whilst no new tax rises materialised yesterday, further fiscal announcements later this year cannot be ruled out.