New wealth taxes, dividend hikes and a tougher line on property investors fuel warnings that affluent households will migrate—and take economic firepower with them
New taxes on property, investment income and savings leave advisers warning that affluent households may accelerate plans to relocate—many towards the US.
Labour’s latest Budget was presented as a fairness-first package—but advisers say the detail tells a different story: a sharper, more targeted squeeze on wealth that could push more high-net-worth households to rethink their future in the UK.
A new tax on homes worth more than £2 million from 2028, alongside a high-value council tax surcharge of £2,500 annually, rising to £7,500 for properties over £5 million, marks one of the most significant fiscal shifts in the prime property market in over a decade. The Treasury expects the measures to raise £400 million, but the broader consequence could be a weakening of the UK’s attractiveness as a base for wealth creation.
READ MORE: Recap the Budget on our live blog
Nigel Green, CEO of deVere Group, said the circumstances around the Budget’s early leak only added to investor anxiety.
“You can’t tell the world you want to stabilise the UK economy and then allow the centrepiece fiscal document to appear online by accident,” he said.
“That extraordinary kind of lapse signals operational weakness. Investors and high earners will be seeing it as a warning about the government’s overall direction.”
Source: Institute for Fiscal Studies
Investment income rises deepen the strain
The Budget also confirmed a 2-percentage-point increase to both basic and higher rates on dividends, property income and savings income. For many investors, landlords and business owners, this adds to an already intensifying tax drag created by frozen thresholds.
Nigel Green said the structural direction is now unmistakable for internationally mobile and affluent households. “When a government fixes thresholds while inflation and wages rise, it quietly increases tax every year,” he said.
“People who generate significant economic activity can relocate easily. They analyse long-term patterns, not political slogans.”
Landlords—already preparing for the Renters’ Rights Act next year—now face tighter margins and reduced investment returns. For some, the combination of rising personal tax and heightened regulatory pressure will prompt a reassessment of where capital is deployed.
ISA (Individual Savings Account) fears calm—but with a structural caveat
Concerns that the government would slash Cash ISA limits were eased. The £20,000 allowance remains, but £8,000 must now be allocated exclusively to investment products. Savers aged 65 and over retain the full £20,000 cash allowance.
While the change is not punitive, advisers say it reinforces the sense that the UK is steadily narrowing how wealth can be held and managed.
Prime property and mobility: the US advantage
With additional recurring taxes now tied to high-value home ownership, property professionals warn of cooling in the £2m–£10m market, especially in London and the South East. This aligns with a broader pattern of affluent households reassessing the UK’s long-term fiscal climate.
READ MORE: Brokers slam new property tax
“A new levy on higher-value homes signals a government willing to target assets whenever revenue is needed. That is enough to shift investment strategies away from the UK,” said Green.
As the UK tightens its approach to property and investment taxation, advisers report growing interest in relocation to jurisdictions such as the United States—particularly states offering more favourable treatment of property, business activity and investment income.
Confidence remains fragile despite wider policy aims
Labour’s broader growth narrative—via wage support, regional funding and structural reform—has done little to offset concerns among high-net-worth individuals. Unlike mainstream homebuyers, affluent households tend to respond swiftly to long-term fiscal signals, not short-term policy announcements.
Advisers say that, for now, confidence is weakening rather than strengthening. The combination of rising taxes, frozen thresholds and targeted asset levies risks accelerating wealth movement overseas—taking investment, spending power and economic activity with it.
