PIMFA Calls on the Government to Prioritise Stability and Fairness at November’s Budget
By Dominic Sow · 22 October 2025
The Personal Investment Management & Financial Advice Association (PIMFA), the trade association representing wealth managers and financial advisers across the UK, has called on the Government to prioritise stability, fairness and long-term planning in its forthcoming Autumn Budget.
PIMFA has warned that renewed speculation around potential tax changes is having a real and detrimental impact on consumer behaviour. Examples of this include speculation about the pensions tax-free cash allowance, and potential changes to the ISA regime.
In light of this speculation, PIMFA is calling on the Government to announce two measures to help quell speculation and create stability:
- The introduction of a pension tax lock, a commitment not to reduce the amount people can withdraw from their pension tax-free or the amount of tax relief given on pension contributions, to remove uncertainty for investors.
- The introduction of a personal taxation roadmap, to inspire confidence among retail investors and reaffirm the Government’s commitment to the UK’s retail investment market.
Delivering growth through fairness
PIMFA welcomes the focus from Government to encourage a greater culture of retail investment in the UK and believes that encouraging a sense of ownership in companies is an important way to do this.
However, changes introduced at the last budget have had an opposite effect. Last year, business relief on AIM shares was limited to 50% of the normal IHT rate, while unlisted portfolios and business relief schemes were left untouched, retaining 100% business relief up to the value of £1m, which falls to 50% thereafter. Since then, PIMFA have witnessed a spike in outflows from the AIM market among members running IHT portfolios.
To fix this unintended consequence, PIMFA is calling for the Government to apply the same level of relief to business relief schemes to stem outflows from the AIM market and boost investor confidence.
PIMFA has also reiterated concerns flagged earlier this month around proposals to levy inheritance tax on unused pensions. Urging the Government to reconsider its approach, PIMFA believes the draft legislation should be amended to protect consumers better, and to address structural flaws in the proposals which make them unworkable.
PIMFA strongly believes that there is a need for a clear and consistent approach to policy that prioritises long-term predictability over short-term adjustments. PIMFA firmly believes that such an approach would reduce investor anxiety, encourage participation in capital markets and help deliver sustainable growth in line with the Government’s economic mission.
Finally, there has been recent speculation on potential ISA reform regarding capping Cash ISAs and restricting tax relief eligibility to wrappers with exposure to ‘UK companies’. PIMFA reiterates its view that this would create significant operational challenges for firms requiring system overhauls, asset reclassification, and consumer communication. It would also confuse savers, distort investment choices, and undermine confidence in the consistency and assurance the ISA regime provides for millions.
Instead, PIMFA suggests the Government would be better to focus on simplifying and modernising the ISA regime by rationalising product variations and further promoting accessibility and awareness of investing. The industry-led retail investing and disclosure campaigns announced at the Leeds Reforms are a welcome step in this regard.
Simon Harrington, Head of Public Affairs at PIMFA, said: “We recognise the difficult decisions that the Chancellor needs to make ahead of the forthcoming Budget. But, in delivering sound, public finances, the Government also needs to be aware of its wider mission to deliver economic growth through the welcome reforms it has introduced over the past year to encourage further investment. To deliver on this mission, we once again urge the Government to prioritise stability in light of the substantive changes it made only 12 months ago.
“The Government must provide certainty around how wealth will be treated for the long-term – not just at the point of savings or investing, but also when it is withdrawn in later life. Speculative debate about future tax changes - particularly those affecting pensions - has a measurable, lasting and negative impact.
“To address negative speculation and encourage long term investor confidence the Government needs to provide a commitment and long term roadmap to its approach to pensions and investment taxation at this Budget. Businesses and consumers value stability above all else, and we urge the Government to focus on commitments that create the conditions for savers and investors to thrive.” Companies in this story: PIMFA
People in this story: Simon Harrington