The Budget

How the budget affects you, your family and your business

Hillier Hopkins LLP

Chartered Accountants & Tax Advisers

Call +44(0)330 024 3200 and discover how we can help you.

The Chancellor Rishi Sunak presented his third Budget on 27 October 2021. In his speech he set out the plans to “build back better” with ambitions to level up and reduce regional inequality.

The main proposals

Tax measures include:

  • A new temporary business rates relief in England for eligible retail, hospitality and leisure properties for 2022/23
  • A change in the earliest age from which most pension savers can access their pension savings without incurring a tax charge. From April 2028 this will rise to 57
  • The retention of the £1 million annual investment allowance until 31 March 2023
  • Individuals disposing of UK property on or after 27 October 2021 now have a 60 day CGT reporting and payment deadline, following the completion of the disposal.

Other measures include:

  • A complete overhaul of alcohol duties that will see drinks taxed on their strength
  • The cancellation of the previously announced rise in fuel duties
  • Pubs supported with a reduction in draught beer and cider duty
  • Increases in the National Living Wage and the National Minimum Wage rates
  • An ultra-long-haul band of air passenger duty introduced.

Some Budget proposals may be subject to amendment in the Finance Bill 2021-22. Should you need any further help or support please contact us.

In focus

Capital Gains Tax payment extension

UK resident individuals currently have just 30 days to report and settle any capital gains tax liability following the completion of the sale of UK residential property (including the residential element of mixed-use property), leaving many struggling to file the additional tax return and to make the tax payment.

The government will, in its Finance Bill, extend that reporting and payment window to 60 days with effect for transactions completing on or after 27 October 2021. Read more.

From the archives

March 2021 – budget summary

Tax measures:

  • A super-deduction for companies investing in new plant and machinery
  • A time extension of the temporary increase to the SDLT nil rate band for residential property in England and Northern Ireland
  • An extension to the temporary 5% reduced rate of VAT for certain supplies
  • A temporary increase in the carry-back period for business losses
  • An increased rate of corporation tax from 2023

Other measures:

  • A new mortgage guarantee scheme
  • Extension to the Job Retention Scheme
  • A Self-Employment Income Support Scheme fourth and fifth grant
  • An extension to the business rates holiday in England
  • Previously announced measures:
  • A cap on the amount of R&D tax credit paid to a loss-making small or medium-sized enterprise
  • New rules apply to off-payroll working payments made for services provided on or after 6 April 2021

Some Budget proposals may be subject to amendment in the 2021 Finance Act. You should contact us before taking any action as a result of the contents of this summary.

September 2020 – Winter Economy plan

As COVID-19 continues to cause disruption to our lives and businesses, Rishi has announced further support today with aim of protecting jobs and helping cash strapped businesses. Here is a brief summary of the announcements and you can find more detail on all of the support packages below in a series of help sheets on our Guide to support page.

  • Job support scheme –  This will replace the Coronavirus Job Retention Scheme which comes to an end next month. It can be used to top up wages of staff whose working hours need to be reduced because of reduced demand or restrictions to trading. The Government will subsidise employees’ wages up to a maximum of 22% (capped at £697.92 per month) for 6 months. To qualify, employees would need to be working at least 33% of their normal hours.
  • VAT cut extended – The 15% VAT cut for hospitality and tourism industries has been extended until 31st March 2021.
  • VAT deferral repayment extended If you deferred your VAT payments earlier this year and were concerned about the impact the repayment would have on your cashflow come March 2021, you can now spread the repayments over 11 months interest free.
  • Help for Self-Assessment taxpayers – You can now extend your tax bill over 12 months from 31 January 2021.
  • Flexible repayments for support loans – Application deadlines for CBILS and Bounce Back Loans have been extended to the 30th November 2020. The government has also announced changes to repayment terms to help cashflow.
  • Self Employment Income Support Scheme extended – This scheme has now been extended until 30 April 2021 with further grants of 20% of average monthly profits available.

July 2020 – Summer Economic update

On 8th July the Chancellor Rishi Sunak announced some new measures aimed at helping the country’s economic recovery.

  • Stamp Duty Land Tax (SDLT) holiday – A temporary Stamp Duty Land Tax (“SDLT”) holiday was announced. It started immediately covering the period from 8 July 2020 until 31 March 2021 inclusive. Read more.
  • Bonus for retaining furloughed workers – Following a seemingly endless stream of redundancy warnings in recent weeks, The Chancellor today announced an incentive for comhttps://hillierhopkins.co.uk/insights/stamp-duty-land-tax-sdlt-holiday/panies to bring employees back from furlough rather than make them redundant. Read more.
  • VAT reduced from 20% to 5% for the hospitality sector – The Chancellor has announced that VAT will be reduced from 20% to 5% on: Accommodation (which includes hotels, B&Bs, camp and caravan sites), food from cafes, bars, pubs, restaurants (including hot takeaways), and attractions (including cinemas, theme parks and zoos). This will be effective for 6 months and ends on 12th January 2021 (as of 24th September the Chancellor announced an extension on the VAT cut to 31 March 2021). Read more.

March 2020 the COVID-19 Budget – Download our 2020 Budget summary

Government pledges £30bn to support UK through Coronavirus including these temporary measures for businesses:

  • For companies with less than 250 employees, the government will refund Statutory Sick Pay costs for up to 14 days.
  • HMRC will defer tax payments for business and self-employed – and 2000 extra staff for their “time to pay” helpline.
  • New temporary coronavirus business interruption loans of up to £1.2m for small businesses – government will guarantee of 80% of the loan
  • Retail, leisure or hospitality businesses with a rateable value of below £51K, will pay no business rates for the next 12 months
  • A review of the long term future of business rates will be launched
  • Providing small business that qualify for small business rate relief will have access to a £3000 cash grant per business.

Taxation announcements:

  • Reduction in lifetime limit of entrepreneurs relief from £10m – £1m.
  • R&D expenditure credit increased from 12%-13%. (This is for R&D RDEC claims)
  • Structures and buildings allowance increased from 2% – 3%
  • Increase employment allowance to £4000
  • Businesses who qualify under the small business rates relief are now eligible for a £3k grant from the Government
  • From 1 April 2021 a new non-UK resident SDLT 2% surcharge is being introduced for purchasers of residential property in England and Northern Ireland.

Subscribe to our Newsletter