2021 Spring Budget Key Updates Summary

Following the Chancellors 2021 Spring Budget announcement this afternoon, I have summarised the key updates that will be relevant to the majority of my small business and personal tax clients. I’ll be posting a detailed analysis once I’ve had time to fully review the updates. 

As always if you have any questions please drop me a line.

Cheers,

Steve Hillman ACA
01934 444100

Budget 2021 key updates:

- Furlough extended until end of September. Still at 80% of salary. Businesses will be asked to contribute 10% from July and 20% for August and September.

- Self-employment grant to be extended. A 4th grant will be available in May and a 5th grant will be available in July.

- Self-employed grant Turnover limits. If your turnover has fallen more than 30% you will receive 80%. If it is less than 30% then you will receive a 30% grant.

- The minimum wage will increase to £8.91 per hour from April.

- New Restart Grant - Non essential retail will receive £6000 per premises. Hospitality, leisure and personal care will receive £18,000.

- New Recovery Loan scheme - Loans of £25k to £1m. 80% government guarantee.

- 5% VAT reduction for hospitality will be extended to 30th September. It will then increase to 12.5% to March 2022 and increase to 20% from April 2022.

- Corporation tax to rise to 25% from April 2023. Businesses with profits under £50k tax will remain at 19%. Tax rate will be tapered between £50k and £250k profit. Profits above £250k at 25% tax rate.

- The "Super Deduction" - Over the next two years, when businesses invest in new equipment, they can offset the full cost for tax purposes plus an additional 30%.

- Stamp duty cut extended by three months.

- "Help to grow - Management" and "Help to grow - Digital" training for SMEs launched - will be effective from June 2021.  Govt will offer subsidised management training (fee - £750 , 10% of unit cost) and will be given vouchers to get up to 50% off the purchase of new productivity-enhancing software, up to £5,000 each to all eligible SMEs. Registration open.