On Wednesday 11 March Chancellor Rishi Sunak delivered his first Budget, and the first since the UK's departure from the European Union, against the backdrop of the coronavirus outbreak.
What are the main points that might affect you or your business? Here is our summary of the key announcements in the 2020 Budget:
The newly appointed Chancellor, Rishi Sunak, announced a spirited Budget with a repeated emphasis on ‘getting things done’, echoing the recent election campaign.
His initial focus was on the short-term measures needed to deal with the challenges the UK faces as a result of the coronavirus pandemic. These amounted to a £12bn fiscal stimulus, with more available if required. There was help for both businesses and individuals.
For the coming year, statutory sick pay will be available to more people and so will some other social security benefits. Business Rates will be reduced or even eliminated for some smaller businesses – at least in the short term. Other immediate support initiatives for smaller businesses include greater access to bank lending, as well as enhancements to the HMRC ‘Time to Pay’ service.
The Chancellor is due to announce another Budget in the Autumn and so there were several consultations about possible future tax changes, including new proposals on the treatment of fund management companies, pension tax administration, and aspects of research and development tax credits.
Some of the other highlights were:
• The changes to the taper of the pension annual allowances will mean that many fewer higher paid people – especially important for the NHS – will be hit by a reduced annual allowance.
• The reduction of entrepreneurs’ relief to £1 million of gain was well trailed, and for a time abolition seemed a possibility. But the more than doubling of the annual limit for Junior ISAs to £9,000 was a pleasant surprise. • Smaller businesses will welcome the increase in the NIC employment allowance to £4,000.
• Publishers should be very pleased by the decision to make electronic publications zero-rated for VAT.
• From April 2021, only electric and other zero-emission cars will qualify for first year allowances and cars with emissions over 50 g/km will qualify for writing down allowances of just 6% a year.
To read about the Budget announcements in more detail, see our Budget Review articles for everything you need to know.
If you have any questions about this summary’s contents or how any aspects of your tax and financial planning may be affected by the Budget, please contact our tax specialists to discuss them on firstname.lastname@example.org