Taxing times: What to look out for in next week's Budget

2 Dividend allowance 

Sunak may also look to cut the dividend allowance, although this could be detrimental for people running their own businesses.

Sarah Coles, personal finance analyst at Hargreaves Lansdown, said: “The dividend allowance has only been around since 2016 and has already been cut from £5,000 to £2,000 in that time.

"Reducing it further could be a mistake, not least because the rate of this particular tax is already set to rise by 1.25 percentage points in April.

“It would be a major blow for people running their own businesses and paying themselves in dividends. They’re already one of the groups who struggled the most during the pandemic. Many of them have taken a serious dent to their financial resilience, so this could risk adding insult to injury.”

3 Capital Gains Tax

The Office of Tax Simplification (OTS) finished its review of CGT in May and recommended major changes such as aligning CGT rates with income tax, removing the CGT uplift on death and reducing allowances.

But Ami Jack, head of national tax at Tilney Smith & Williamson, said if Sunak were to make any of these changes it could discourage potential entrepreneurs which would stunt growth and job creation.

She said other options would be a smaller rate rise, say to 30 per cent, CGT rate increases only on disposals of more passive types of investment such as on rental property, and more technical changes to CGT reliefs.

Jack warned against knee jerk reactions: “Any action taken in anticipation of changes does involve significant risk for individuals. For example, CGT rates may not change as they expect, although rates falling is very unlikely, or action taken before the next Budget could be caught by a subsequent change.”

4 Stamp duty

The industry is sceptical as to whether there will be, or should be, any further changes to stamp duty.

Darren Cooke, chartered financial planner at Red Circle Financial Planning, said: “I really hope [Sunak] doesn't do anything with stamp duty, particularly anything to help BTL landlords, in fact I'd rather hope he does the opposite and starts to tax them more but I can't see that happening.

“Frankly he doesn't have much room to manoeuvre, what he should tax, and could tax, property wealth, very high incomes etc. he won't. What he wants to tax he can't without it having other, potentially serious, impacts elsewhere in the economy.”

Despite the Stamp Duty holiday from July 2020 to the end of September 2021 the Treasury has received a significant £13.5bn in revenue from the tax, according to the latest HM Revenue and Customs figures.

The final phase of the tax break – with the threshold having being decreased from £500,000 to £250,000 on 30 June – ended on 30 September.