Budget 2021 Key Points

The Chancellor of The Exchequer, Rishi Sunak, today delivered his much-anticipated Budget Speech.  Here are the key headline announcements:
 
Coronavirus Support

• The Coronavirus Job Retention Scheme (furlough) is to continue to the end of September 2021, with employers contributing 10% towards staff costs in July and 20% in August and September.
• Self-Employed Income Support Scheme is being extended for a further two grants and will now include a further 600,000 newly self-employed individuals who have previously missed out.
• Universal Credit £20 weekly top-up to continue until September 2021.
• Working Tax Credit claimants to get £500 one-off payment.

 
Business Support

• ‘Restart Grants’ for the High Street, with up to £18,000 per premises being available depending on the type of business and when the business can reopen.  This will replace the current monthly grant system for businesses.
• Existing Business Rates Holidays to continue until end of June 2021, with a 75% reduction in rates until the end of March 2022.
• The reduced VAT rate of 5% for the hospitality sector to continue until September 2021, when it will then increase to 12.5% until April 2022.  It will then revert back to the standard rate.
• Recovery Loan Scheme announced to replace CBILS and Bounceback Loans, which will be in place from 6 April to 31 December 2021.  Businesses can apply for loans between £25,000 and £10,000,000 with the government providing guarantees of 80% to lenders.

 
Tax

• No changes to rates of Income Tax, National Insurance or VAT.
• Personal Tax Allowance set at £12,570 and Higher Rate Tax Threshold set at £50,270 from 6 April 2021 and these will remain at this level until 2026.
• Inheritance Tax Threshold, Pensions Lifetime Allowance, Capital Gains Tax Annual Exemption and VAT Registration – All thresholds to be frozen. 
• Corporation Tax from 2023 to be charged at 19% of profits up to £50,000, 25% on profits over £250,000 with a tapered rate applied for profits between then amounts.
• Corporation Tax loss relief extended for the next two years to allow carry back of losses against profits of the prior three years.
• ‘Super Deduction’ giving 130% allowance on investment in new plant & machinery acquired from 1 April 2021 for two years.

 
Property

• ‘Mortgage Guarantee Scheme’ which will see 95% mortgages return from April 2021.
• The Stamp Duty holiday with no duty on properties up to £500,000 to be extended until 30 June 2021.  The threshold will then reduce to £250,000 until September 2021 before returning to the pre pandemic threshold of £125,000

 
Other

• There will be an increase to the payments made by the government to firms taking on apprentices to £3,000.
• Living wage increased by 2.2% to £8.91 from April 2021.
• Alcohol and fuel duty frozen.

 
The devil is always in the detail and we will continue to monitor the Government press releases as they are issued and bring you further information as soon as we know it.
 
We are here to help, so if you wish to discuss any of the above then please contact us