FURLOUGH

Scheme has been extended to September 2021

Employees will still receive 80% of their wages (capped at £2,500pm)

However employers will have to contribute 10% in July and 20% in August and September

SEISS GRANT – (Self Employed)

4^th and 5^th has been issued to become available and to include all those who have filed 2019/20 tax return (filed before midnight on 1^st March.

Fourth grant covers February to April 2021and will again be the 80% of 3 months average profits (from prior tax year).

Fifth grant will cover May to July and will also be 80% of 3 months average profits BUT only for those who have suffered a reduction in turnover of at least 30%. For those who have had a reduction in turnover less than 30% will receive a grant of 30% of 32 months average profits.

PERSONAL TAX

Personal tax thresholds are frozen until 2022, and increases from 2022 are promised, with a tax freeze until 2026.

However personal tax threshold had already been agreed for tax year 2020/21 at £12,570 (so this will be the rate at which is frozen).

Higher rate tax threshold to increase to £50,275 and will remain until April 2026.

CORPORATION TAX (Ltd Companies)

The rate of Corporation Tax is to be increase to 25% from April 2023, for companies with profits in excess of £250K.

Companies with profits of £50K or less will continue to be taxed at 19% (current corporation tax rate).

Taper allowance will be introduced for companies with profits that fall between the £50K-£250K.

SUPER DEDUCTION – on investments of qualifying plant & machinery

Companies will be able to claim a deduction of 130% of the costs on investing in capital assets by way of capital allowances.

CARRY BACK LOSSES

Companies will be able to carry back losses for 3years to secure repayment of tax paid in prior years.

BUSINESS HELP

New restart grant – will be available in April to help businesses who have been effected by Covid-19 closures.

Non Essential retail will receive up to £6K per premises.

Hospitality and Leisure (including Gyms and personal care), will receive up to £18K per premises.

Bounce back loans – application date set to end 31^st March

New Recovery Loan scheme to be introduced – businesses can apply for loans of £25K-£10M until the end of 2021.

Government will provide 80% guarantee to lenders.

LEISURE & TOURISM

5% reduced vat rate will continue to apply until 30^th September 2021

After which there will be an interim rate of 12.5% until April 2022

Then VAT rate will return to normal 20%

Leisure, hospitality, and Retail will continue to receive 100% business rates relief until June 2021

For the remainder of the tax year, business rates will be discounted to 2/3rds (capped at £2M for businesses that were required to close as at 5^th Jan 2021. The cap for businesses who have been able to remain open will be £105K)

STAMP DUTIES & OTHER DUTIES

The £500K nil rate band will be extended until 30^th June.

From 1^st July – 30^th September the nil rate band will be £250K

The normal rate of £125K nil rate band will be back in force from 1^st October 2021

No increases of duties in alcohol or fuel to be imposed

FIRST TIME BUYERS

Government guarantee to provide 95% mortgages for first time buyers.

OTHER

• National minimum wage – to increase to £8.91 from April 2021
• Test and Trace support of £500 payments in England until the summer.
• Universal Credit – uplift of £20pw to remain for 6 months.
• Working Tax Credits – to receive an additional one off payment of £500
• Apprentice kick start grant – to pay employers double, £3K per apprentice of any age (was previously £1,500 of apprentices up to the age of 25)
• Legal limit of contactless payment to increase to £100 per transaction from £45
• Maintaining inheritance tax thresholds at their current levels until April 2026
• Capping the SME payable R&D tax credit that a business can receive in any one year at £20K (plus three times the company’s total PAYE & NICs liability)
• Maintaining the lifetime allowance at its current level of £1,073,100 until April 2026
• The adult ISA annual subscription limit for 2021-22 will remain unchanged at £20K
• Investment in HMRC to tackle COVID-19 support fraud and tax avoidance

For full Budget 2021 debrief click here