UK Chancellor Rishi Sunak will unveil his second budget of the year on Wednesday, as he reveals how much people will be taxed and what this money will be spent on. 

The statement to MPs on October 27 will coincide with the conclusion of the spending review, which was launched by the Chancellor in September. 

But what exactly is the difference between the budget and the spending review, and why are they important?

Here's what you need to know...

What is the difference between the budget and the spending review?

The budget outlines the plans for raising or cutting taxes, and also how the government plans to spend money over the coming months. 

Meanwhile, the spending review aims to give a five year review of the government's spending plan, including how much money they will give to each government department and public services. The spending review will detail the maximum amount each of these departments can spend until Spring 2025.

While the budget takes place once or twice a year, a spending review is carried out roughly once every three years. 

The exception to this was in 2020, when, due to the Covid pandemic, the review covered a one-year period from April 1 2021 to March 31 2022. 

How do the budget and spending review impact me?

Both announcements will impact the population in different ways.

The budget is likely to have a more direct impact on individuals as it is directly linked to how much people will be taxed. 

It can therefore impact how much money individuals have to spend.

The spending review on the other hand details the government spending on public services and how much government departments will receive, which will in turn impact individuals via a ripple effect. 

Ultimately, the spending review will impact the spending on things such as NHS hospitals, state schools and roads, which then has a huge impact on the population. 

When will the budget and the spending review be announced?

The budget and spending review will be announced on Wednesday October 27. 

Rishi Sunak will make a statement in the House of Commons, expected around 12:30pm.