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Budget: Extensions to Furlough, Self-employed Support, Business Grants, Loans & VAT Cuts: Total Support Over £407 Billion.

The Chancellor has announced his 3 point plan to protect jobs and strengthen public finances:

  • Billions to support businesses and families through the pandemic
  • Investment-led recovery as UK emerges from lockdown
  • Future changes to strengthen public finances

We look at the schemes, grants announcements and anything else related to businesses and self-employed people.

Furlough Scheme: Coronavirus Job Retention Scheme (CJRS) 

The CJRS will be extended until end of September as follows:

  • Now to end of June - government to pay 80%
  • July - government to pay 70% and employer to pay 10%
  • August and September - government to pay 60% and employer to pay 20%

Self-Employment Income Support Scheme (SEISS)

A fourth SEISS grant will be paid:

  • At 80% of the average monthly profits
  • Covers February – April 2021
  • Paid in one instalment
  • Capped at £7,500
  • People that became self-employed in 2019-20 may be able to claim the grant
  • There will be a 5th SEISS grant

Business Rates

  • Business rates holiday in England has been extended by an additional three months meaning no business rates for 3 months from 1st April (when combined with Small Business Rates Relief)
  • Further relief available for the rest of the year

VAT

  • 5% reduced rate of VAT for tourism and hospitality sectors extended for six months until end of September
  • Interim rate of 12.5% for a further six months
  • Standard rate of 20% to apply from April 2022

Statutory Sick Pay (SSP)

Small and medium-sized employers in the UK will continue to be able to reclaim up to two weeks of eligible Statutory Sick Pay (SSP) costs per employee from the Government.

Income Tax

Income tax personal allowance stay and the higher rate threshold stay the same, they will rise next year as planned and will then be maintained at that level until April 2026

Corporation Tax

  • Will increase to 25% in 2023 for businesses with profits of over £250,000
  • Businesses with profits of £50,000 will continue to be taxed at 19%
  • A tapered rate will be introduced for profits above £50,000 but below £250,000

Restart Grant

One off grant of up to £18,000 for hospitality, accommodation, leisure, personal care and gym businesses

Recovery Loan Scheme

This scheme will be launched to replace the existing government guaranteed schemes, offering loans between £25,001 and £10 million, and asset and invoice finance between £1,000 and £10 million.

The National Living Wage

Will be increased to £8.91 from April

Universal Credit

There is a six-month extension of the £20 per week Universal Credit uplift, with eligible Working Tax Credit claimants receiving a one-off payment of £500.

Duties

  • Fuel duty frozen for the 11th consecutive year
  • There will be a freeze in duty rates for beer, cider, wine and spirits.

Apprentices

  • The government are doubling the cash incentive to businesses who take on an apprentice to a £3,000 payment per hirer regardless of the apprentice’s age
  • £7 million for a new “flexi-job” apprenticeship programme in England, that will enable apprentices to work with a number of employers in one sector
  • Additional £126 million for 40,000 more traineeships in England, funding high quality work placements and training for 16-24 year olds in 2021/22 academic year.

Homebuyers

  • New mortgage guarantee scheme to secure a mortgage up to £600,000 with a 5% deposit
  • Extension to the temporary cut in Stamp Duty Land Tax to September.

Super Deduction

  • For businesses investing in new equipment from April 2021, a new super-deduction will cut companies’ tax bill by 25p for every pound meaning they can reduce their taxable profits by 130% of the cost
  • Lasts 2 years.

Art, Culture and Sport

£700 million will support the UK’s arts, culture and sporting institutions as they reopen and to back the UK and Ireland’s joint bid to host the World Cup in 2030.

Other

  • More than doubling the legal limit for single contactless payments, from £45 to £100.
  • £100 million for a new Taxpayer Protection Taskforce to crack-down on COVID fraudsters who have exploited UK Government support schemes.
  • Inheritance tax thresholds to stay at their current levels until April 2026.
  • Capping the amount of SME payable R&D tax credit that a business can receive in any one year at £20,000 (plus three times the company’s total PAYE and NICs liability).
  • ‘Future Fund: Breakthrough’ worth £375 million will invest in highly innovative companies such as those working in life sciences, quantum computing, or clean tech, that are aiming to raise at least £20 million of funding.
  • New Help to Grow scheme to offer up to 130,000 companies across the UK a digital and management boost.


 

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