Spring budget 2021 – latest update

Here are the headline announcements from the Chancellor’s Spring budget:

  • The furlough scheme  will continue until the end of September 2021. In July, employers will be required to pay 10% of wages to employees, increasing to 20% in August and September.
  • Self Employed grants will continue, with one grant to cover the February – April period, and a final one to cover the period from May onwards. An additional 600,000 claimants are now expected to be eligible following submission of February’s tax returns.
  • The National living wage will increase from April
  • A new Restart Grant will be introduced to help closed businesses reopen. Those in non essential retail, currently due to open on April 12th will be eligible of a grant of up £6k.
  • Later opening businesses, including hospitality, hotels, gyms, as well as personal care and leisure firms will receive grants of up to £18k.
  • A new recovery loan scheme will introduced, guaranteed to 80% by the government, offering between £25k and £10m.
  • The business rates holiday for retail, hospitality and leisure businesses will continue until the end of June, then rates will be reintroduced at lower interim rate.
  • The 5% reduced VAT rate will continue in the hospitality sectors until September, followed by an interim rate of 12.5% until the end of April 2022.
  • Contactless payments limit increased to £100
  • Personal income tax thresholds will be raised as planned in 2022, and then held until 2026.
  • Alcohol and fuel duties continue to be frozen
  • Corporation tax will increase in 2023. The most profitable companies (profits £250k+) will pay 25% corporation tax, tapering down to 19% for businesses with profits of £50k or less.
  • Companies will be able to carry back losses over three years to enable greater tax rebates for struggling companies.

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