A brief summary of Chancellor Rishi Sunak’s 2021 Budget is detailed below:
Income tax: For 2021/22 Personal Allowance increasing to £12,570, basic rate band to £37,700 meaning a higher rate threshold of £50,270 – but then these figures will be frozen until April 2026. No changes to dividend allowance, personal savings allowance, starting rate band for savings.
Capital gains tax annual exempt amount frozen at £12,300 until April 2026. No change to the tax rates for CGT
Corporation tax: In 2023 the main corporation tax rate will increase to 25% but for companies with profits of no more than £50,000 the rate will remain at 19%. There will be a tapering of the rate for companies with profits over £50,000 but less than £250,000 so only companies with profits above £250,000 will suffer the full 25% rate.
Inheritance Tax nil rate band frozen at £325,000 and residence nil rate band at £175,000 until April 2026 (and the residence nil rate band taper threshold remains at £2 million until April 2026).
Pensions: Lifetime allowance for pensions frozen at £1,073,100 until April 2026. No changes to annual allowance, money purchase annual allowance or tapered annual allowance figures or rules.
ISA subscription limit remains at £20,000 in 2021/22 and the Junior ISA and Child Trust Fund subscription limits remain at £9,000.
Stamp Duty Land Tax (SDLT) temporary cut in England and Northern Ireland extended until September 2021. The £500,000 nil rate band will be extended until 30 June 2021 then it will be set at £250,000 until 30 September 2021 returning to its standard level of £125,000 on 1 October 2021.
New mortgage guarantee scheme to enable all UK homebuyers to secure a 95% mortgage on properties up to £600,000 – only a 5% deposit needed.
Other announcements:
Fuel duty and alcohol duties are frozen.
Coronavirus Job Support Scheme extended to September 2021 across the UK (employer contribution of 10% required in July and 20% in August and September).
Self-Employment Income Support Scheme (SEISS) extended to September 2021 across UK, with those who filed a tax return in 2019/20 now being able to claim for the first time.
Furlough will be extended for six months until the end of September – with employers paying contributions from July onwards.
The VAT cut will be extended for another six months – and then it will go up to 12% for another six months after that.
Click this link to read a summary of the Budget produced by Standard Life Techzone.
Chancellor Rishi Sunak stated the Government will continue doing “whatever it takes” to support British people and businesses, as well as starting to fix public finances and beginning to build the future economy.
Best Regards.
Best Price FS Team |
