With Budget day fast approaching there will be plenty of speculation about what George Osborne will come up with, particularly after the pyrotechnics of last year when, completely without warning, he produced the radical new pension rules which come into effect next month.

However, I think anyone expecting similar surprises this year is likely to be disappointed, as any pre election Budget tends to be a case of smoke and mirrors as the Chancellor tries to appear as generous as possible to voters while avoiding any significantly increased expenditure which could see the national debt figure reversing its recent falls. In fact, with a very tight contest in prospect it seems unlikely that Osborne will have much leeway for any major giveaways.

I would expect further measures to combat tax avoidance, particularly on the part of multinational organisations, as well as further increases to the level at which income tax becomes payable and at which the higher rate starts to apply.

Inevitably there will be speculation about changes to the rules on tax free lump sums from pensions, and further reductions in the annual and lifetime allowances, but realistically this is not a Budget for making changes which would be seen to detract from people's ability to enjoy a comfortable retirement.

One thing that I am confident won't happen is any change to the rules on pensions owning residential property, something to which HMRC are vehemently opposed and which could create a dangerous bubble in a recovering property market. Famous last words of course!

The two areas where I think we could see some innovation are the possible introduction of a new savings product aimed at the post retirement market to build on the success of Pensioner Bonds and also new tax breaks to encourage people to save towards future care costs, possibly in the form of a new type of ISA or by removing the tax liability from pension payments used exclusively to cover care costs.

How accurate are my predictions? We'll soon see!

Robin Sainty APFS M.A. (Cantab)