Over half (56%) of UK adults are worried that any increases to their personal tax bill will hit their standard of living in the year ahead, Rathbones has found.

The investment management firm’s study of 1,034 UK adults revealed that this figure rises for those in work.

Over three in five (61%) of those in full-time employment said they are concerned about any increases in tax burdens, while 65% of part-time employees and 59% of self-employed people echoed the same concerns.

The firm also revealed that 27% of those surveyed said increases to their tax bills have already affected their standard of living in the past year.

Once again, it was working adults that were more likely to have experienced a drop in living standards due to having to pay more tax.

Twenty-nine per cent of people in full-time employment said increases in personal tax have harmed their standard of living, along with 33% of part-time employees and 31% of people who are self-employed.

Rathbones said that these rising personal tax bills are due, in part, to an increasing number of people who are pulled into higher rate tax bands.

Of those surveyed, 10% said they have become a higher rate taxpayer for the first time in the last 12 months. This rose to 17% for those in full-time employment.

Furthermore, 12% said they expect to be a higher rate taxpayer in the next 12 months, and this rose to 18% of those in full-time employment.

Senior financial planning director at Rathbones Group, Faye Church, said: "Even before any possible tax changes are announced in the Budget later this month, our research shows that around a third of people already feel a significant squeeze to their standard of living as they are having to pay higher tax bills. And more than half fear that their living standards are going to deteriorate because of having to stump up higher tax bills in the year ahead.

"Many personal tax thresholds have been frozen since 2021, instead of rising with inflation, meaning more and more people are being dragged into higher tax bands. Seeking out professional financial advice from a qualified adviser can help people to ensure they are being as tax efficient as possible and making the most of the allowances they have."

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