Furlough: The furlough scheme will be extended until the 30th September with employees continuing to receive 80% of their wages. Employers will be asked to contribute 10% in July and 20% in August and September as the scheme tapers out. For further details of the furlough scheme, please see our latest article.
Self-Employment Income Support Scheme (SEISS): A fourth grant payment (worth 80% of average trading profits up to £7,500) will be made to cover the period February to the end of April. A fifth grant will be available for lost income in June, July and August 2021. Newly self-employed workers will also be entitled to these grants provided they submitted a tax return by midnight on the 2nd March 2021. For those whose turnover has fallen by 30% or more will continue to receive the full 80% grant whilst those whose turnover has fallen by less than 30% will receive a 30% grant. To find out if you are eligible for the grant, please click here.
National Minimum Wage: The minimum wage will be increased from April to £8.91 an hour for workers aged 23 and over.
Stamp Duty Land Tax: An extension of the up-to-£500,000 nil rate band for stamp duty has been made until 30th June 2021. This will be followed by a £250,000 nil rate band until September 2021 before turning to the original £125,00 thereafter.
This extension means that the maximum saving of £15,000 will therefore continue until the end of June. Please click here to get a conveyancing quote today.
Mortgage Guarantee Scheme: A mortgage guarantee scheme has been introduced to help UK homebuyers purchase properties worth up to £600,000 with just a 5% deposit and the government underwriting the other 95%. Many of the big lenders are set to take part in this from April 2021.
SUPPORT FOR BUSINESSES:
Business rates holiday: This will be extended until 30th June 2021 to help the hardest hit businesses including hospitality, retail and leisure. This will then be discounted by two-thirds for the remaining nine months of the year.
Reduced VAT: The 5% reduced VAT rate for hospitality and tourism will be extended until the 30th September 2021 followed by an interim rate of 12.5% lasting until April 2022. The standard rate of 20% will be reinstated from April 2022.
Restart Grant: £5 billion has been put towards the new Restart Grant which will launch in April. This is a one-off cash grant of up to £18,000 for businesses in the hospitality, accommodations, leisure, personal care and gym sectors in England.
Coronavirus Loans: A new loan scheme, the Recovery Loan Scheme will be implemented offering support of between £25,000 and £10m as well as asset and invoice finance between £1,00 and £10m. This will replace the bounce back loan (BBL) and coronavirus business interruption loan scheme (CBILS) which will soon be coming to an end.
Corporation Tax: Corporation tax will increase to 25% although this will not take effect until 2023 to support the recovering economy. Businesses with profits of £50,000 or less will continue to be taxed at 19%. For profits above £50,000 a tapered rate will be introduced to that only those businesses with profits of £250,000 or more will be taxed at the higher 25% rate. The Government is allowing a 130% super-deduction on tax for investments made by companies. This means firms can cut their taxes by up to 25p for every pound they invest.
Taxpayer Protection Taskforce: £100m has been set aside for the Taxpayer Protection Taskforce to come down on those businesses exploiting the support schemes and defrauding the taxpayer.
Apprenticeships: Firms will receive up to £3,000 from an incentive payment to hire apprentices between 1st April and 30th September 2021. There will also be a further £126m for traineeships in England.
Personal Tax thresholds: National insurance, income tax and VAT will be frozen.
Personal Tax allowance: This will remain at £12,750 until 2026. The higher rate will increase to £50,270 in 2022 and then remain at that level.
The pensions lifetime allowance, annual exempt allowance from capital gains tax, inheritance tax threshold and VAT exemption threshold will all be frozen.
Culture Recovery Fund: More than £400m will be allocated to help museums, theatres and galleries reopen together with a £300m support package for sports.
We’re here to help
If you have any queries as to how the Spring Budget 2021 may affect your business, we have specialist legal teams to provide advice and support as we gradually follow the road map out of lockdown. For a free initial telephone consultation, please call 01926 491181.