With an apparent surge in membership, a rise in the opinion polls and a potential huge donation from one of the richest men in the world, Reform UK could genuinely be in contention at the next general election.
If they were able to overcome the challenges of the first past the post voting system, then there could be a radical change to UK politics having had a Conservative or Labour led government since the early 1900s.
Even if they don’t achieve the ultimate success of winning an outright majority at the next election, Reform certainly look like they will influence the Conservative’s and Labour’s thinking.
Whilst I do have a keen interest in politics, I am more concerned with how the politics impacts our personal finances.
So, I thought it would be a good idea to have a look at what Reform has actually said when it comes to their policies around your personal finances.
To be clear, this article is not politically motivated and I am not saying you should support Reform. I just believe that as their support and exposure grow, we need to understand them and what they want to do with our money.
What Reform have said
Reform UK was only launched in 2021 as part of a re-brand from its previous version, the Brexit Party, which itself was only founded in 2018.
So, we have very little to go on in terms of their long-held beliefs and policy statements.
The most comprehensive policy document to date has been their ‘Our Contract With You’ document which was essentially their manifesto for the last general election.
Personal Allowance
First up we have the Income Tax Personal Allowance. This is the amount of income you can earn or receive before having to pay Income Tax.
The allowance is currently £12,570 at the time of writing.
Reform would like to increase this to £20,000.
After this basic rate Income Tax would kick in and they would keep this at the current rate of 20%.
They would lift the income level at which higher rate Income Tax kicked in from the current £50,270 to £70,000.
They also propose an increase in the transferable Marriage Allowance meaning 25% of a spouse’s Personal Allowance could be transferred. This means a married person could actually earn or receive up to £25,000 tax free.
All positive so far.
However, remember the Personal Allowance and Income Tax bands have been frozen since April 2021 and continue to be frozen until 2028.
By this time the Allowance and bands should be a lot higher anyway when you factor in the impact of inflation. So, the proposed changes by Reform are not actually that radical.
Reform don’t mention how they would increase the bands going forward in future years.
Stamp Duty
Reform say they would make some big changes to Stamp Duty which after the last Labour Budget has got a bit ridiculous.
It has become very expensive to buy a home in this country and that’s before you factor in the actual price you pay for a home.
Stamp Duty is a crazy amount of money to pay the government just to buy a home. There is no work for the government to do when you buy!
Reform say they would remove Stamp Duty on all residential property purchases that cost below £750,000 and cut it substantially on purchases above this.
Here is a comparison of the new rates from 1st April 2025 compared to Reform’s proposed changes.
Reform have not said what they would do about the additional Stamp Duty for Buy To Let investors so I assume this would stay in place but potentially using the same bandings as their proposed changes above.
This would still make buying significantly cheaper for investors.
Buy To Let Investors
Sticking with Buy To Let investors, Reform say they want to encourage smaller landlords into the rental markets and not penalise them which is a welcome change to the current government’s rhetoric.
Reform proposes to restore the right to deduct finance costs and mortgage interest from tax on rental income.
Pensions
Reform say little about pensions or everyday investing into products like ISAs.
So, nothing about changes to pension tax relief or stamp duty on buying shares.
They do say “the current pension system is riddled with complexity”.
They mention a liking of the Australian model, but it is unclear whether this refers to private and public sector pensions or the State Pension.
A reminder that the Australian State Pension model does include some form of means testing. I covered this on a previous video.
Inheritance Tax
Very topical at the time of writing following the Labour government’s attack on farmers and small business owners.
Reform say they would abolish Inheritance Tax for all estates under £2 million and lower the Inheritance Tax rate on estates above this from 40% (currently) to 20%.
It’s not clear whether the £2 million allowance would be for a single person or for a couple.
Remember, a married couple or those in a civil partnership who own their own home can already claim up to £1 million in Inheritance Tax allowances.
Private Healthcare
Although Reform still seems to be very pro the NHS, they have come up with an interesting solution to relieve pressure.
They propose tax relief of 20% on private healthcare insurance.
Company owners can of course already get tax relief on their private healthcare insurance paid through the company. However, encouraging more people to use private healthcare insurance could make this a more competitive marketplace.
Education
Some interesting ideas here and a swipe at the recent Labour change of including VAT on private school fees.
Reform say they would scrap VAT on private school fees and go a step further and give 20% tax relief on payments.
They would also scrap interest on student loans making them much more affordable when factoring in the impact on inflation down the line.
Business Owners
For those business owners and those who have set up limited companies, Reform would make significant changes to Corporation Tax.
They say they would increase the minimum profit threshold to £100,000 and reduce the main rate of Corporation Tax from 25% to 20% and then to 15% from year three.
A definite step in the right direction and a change that might actually encourage some growth!
There are also proposals to lift the VAT threshold to £150,000 and abolish Business Rates for high street based small and medium sized companies.
What else?
There is some stuff around scrapping a lot of the net zero work, subsidies and levies and reducing energy bills further by removing VAT and lowering fuel duty.
There are lots of mentions of reviewing things (like social care for example) and cutting government costs etc but when there is nothing specific, I take it with a pinch of salt.
Whenever political parties talk about carrying out a review, it usually means they want to kick the can down the road.
In terms of other sources and getting views of Reform UK’s ideas, leader Nigel Farage has said recently that he thinks public sector pension schemes are like “Ponzi schemes” and the “biggest ticking time bomb” within government finances. So, expect changes here.
He has also said that he ultimately wants to scrap Inheritance Tax altogether.
Of course, it’s not all about Nigel Farage and his views. Reform UK has other leading figures and actual MPs now, but he is the most influential still so worth following what he says.
More to come
As we said earlier it is still really early days for Reform and the proposals we have run through were put together when they very likely knew they would be nowhere near getting into power.
Due to the first past the post system, they may never get into power and even if they did, once in government and dealing with government they may find things much harder to implement in reality.
I personally don’t think they have been radical enough and have not said enough on cutting government spending, reducing borrowing and the huge debt the government have built up.
For now, all we can do is watch things closely and look at the financial policies of all parties to see how they may potentially impact you and that’s what I’ll be doing over the foreseeable future so look out for more articles on this.
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