A Roundup of The March 2021 Budget

Get in touch for a no-obligation chat about how we might be able to help you.
Your property may be repossessed if you do not keep up repayments on your mortgage.

Some buy to let mortgages are not regulated by the Financial Conduct Authority

What's On This Page?

Get In Touch

[[[["field8","contains"]],[["hide_fields","field5"]],"and"]]
1 Step 1
Please tick how you would like us to contact you.
keyboard_arrow_leftPrevious
Nextkeyboard_arrow_right

Given the events of the past year, it was only to be expected that the March 2021 budget would be dominated by COVID19.  It was also only to be expected that Brexit would also be a factor.  Here is a quick guide to the main parts of the budget and what they mean.

COVID19 support extended

Both the furlough scheme and grants for the self-employed are to be extended until September.  Employers using the furlough scheme will be required to contribute 10% in July and 20% in August.  It is believed that around 600K more people will have access to self-employed grants.  This reflects the fact that people should have filed and paid their 2019/2020 taxes by now.

Stamp Duty holiday extended

The Stamp Duty holiday has been extended until the end of June.  From July to September (inclusive) home buyers will have a Stamp Duty threshold of £250,000.  Rates are then scheduled to return to normal in October.

Effective tax increases

Only Corporation Tax has been overtly raised (from 19% to 25%).  Even then, the raise only takes effect from April 2023 and there is an exemption for companies with profits of less than £50KPA.  Income Tax, National Insurance and VAT all stay at the same rates.

The tax-free personal allowance and the higher-rate income tax threshold have been increased to £50,270.  They will, however, be frozen at these levels until 2026.  This means that anyone whose earnings increase over the coming years could find themselves paying more tax.

The Chancellor is also freezing the thresholds for Capital Gains Tax exemptions, Inheritance Tax and the Pensions Lifetime allowance.  These will stay at 2020/2021 levels until 2025.  Again, if inflation rises, this could result in more people paying more tax than they otherwise would have done.

IR35

Interestingly, the Chancellor’s speech did not once mention IR35.  Without any declaration (or even indication) to the contrary, it, therefore, has to be assumed that the government and HMRC are ploughing ahead with its introduction.

This raises the prospect of ongoing confusion about who should and should not be included under IR35.  HMRC has already lost two high-profile cases on this issue (Lorraine Kelly and Kay Adams).  It seems reasonable to expect further legal skirmishes while the changes bed in.

Support for businesses

Business rates will be suspended until the end of June after which they will be charged at 25% of the standard rate.  There will also be £5B of grant-aid made available to businesses forced to close during the pandemic.  Arts and sports will receive targeted packages with almost £400m being made available to arts venues in England and £300m being earmarked for professional sport.

Football will particularly benefit.  The government has allocated £25m to restart grassroots soccer.  They have also pledged £1.2M to support the hosting of the Women’s Euros football tournament.  This is now scheduled for 2022.

Hospitality firms will continue to pay 5% VAT until September.  In October, the rate will be increased to 12.5% and this will apply for the following 6 months.  Hopefully, this will help to offset the costs (and hassle) of restarting a business and help to make hospitality feel more festive in winter 2021.

There is also cash support for firms taking on apprentices and tax breaks for investment costs.  Interestingly, the chancellor also referenced a new visa scheme intended to help firms in need of skilled workers.

Infrastructure

A new “infrastructure bank” is to be set up in Leeds.  This will have 12b in capital and will aim to assist with the funding of up to £40b of public and private infrastructure projects.  The chancellor also announces a new “green bonds” scheme to help the UK meet its target of being “net zero” by 2050.

Mortgage Blackpool

Our Remortgaging Guide

Download our free guide filled with tips and information.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE. We will NEVER sell or give away your information, however, the internet is not a secure medium and the privacy of your data cannot be guaranteed

[]
1 Step 1
keyboard_arrow_leftPrevious
Nextkeyboard_arrow_right