Budget - 3 March 2021
The following are the main points from the March 2021 Budget. We will be providing clients with a full summary of the various measures announced today.
Coronavirus support measures
- Government to continue paying 80% of furloughed employees' wages for hours they cannot work
- Employers to be asked to contribute to furlough pay - 10% in July and 20% in August and September
- Support for the self-employed also to be extended until September (SEISS)
- 600,000 more self-employed people will be eligible for help as access to grants is widened
Income and capital taxes
- No changes to rates of income tax, national insurance or VAT
- Tax-free personal allowance to be frozen at £12,570 from April 2021 levels to 2026
- Higher rate income tax threshold to be frozen at £50,270 from April 2021 levels to 2026
- Corporation tax on company profits above £250,000 to rise from 19% to 25% in April 2023
- Rate to be kept at 19% for smaller companies with profits of less than £50,000
- Stamp duty holiday on house purchases in England and Northern Ireland extended to 30 June
- Inheritance tax thresholds, pensions lifetime allowances and annual capital gains tax exemptions to be frozen at 2020-2021 levels until 2025-26
Business investment and VAT
- Firms will be able to use the "super-deduction" to deduct investment costs from tax bills, reducing taxable profits by 130% through capital allowances.
- Incentives for firms to take on apprentices to rise to £3,000 and £126m for traineeships
- Lower VAT rate for hospitality firms to be maintained at 5% rate until September
- Interim 12.5% rate will then apply for the following six months
Other measures- Minimum wage to increase to £8.91 an hour from April
- Contactless payment limit will rise to £100 later this year