Budget 2021 – Your Information Guide

03 May 2021
Ortenz & Co Ltd.

Orignal Article: Budget 2021: What you need to know

Below mentioned are the measures announce by the Chancellor Rishi Sunak in the Budget 2021.

1 – COVID-19

To ensure the COVID-19 vaccination roll-out throughout England, the government has injected £1.65 billion extra.
To increase UK’s vaccine testing, support of clinical trials and gaining access to new variants of Covid-19, the government has further allocated £28 Million.
The government has allocated £22 million for a study of effectiveness of combinations of different Covid-19 vaccines. The research is also working on effectiveness of the third dose of vaccine for improved response against current and futures variants of Covid-19. This study is first of its kind.
The government is further adding £5 million to previous allocation of £9 million for clinical scale mRNA manufacturing. These funds will also help to create a library of vaccines that are to work against Covid-19 variants.
The government is further extending its test and trace support payments of £500 until summers.

2 – Protecting Jobs and Livelihoods

The Government has extended the Coronavirus Job Support Scheme across UK till September 2021.
600,000 people who have filed the tax returns in 2019—20 will now be able to claim the UK-wide Self Employment Income Support scheme till September 2021.
To protect and create jobs in the housing market, there is a temporary cut in Stamp Duty Land Tax in England and Northern Ireland with an extension till September 2021.
All UK homebuyers can secure a mortgage up to £600,000 with a 5% deposit under the new mortgage guarantee scheme.
Businesses such as hospitality, accommodation, leisure, personal care and gym in England can now avail a one-off cash grant of up to £18,000, from the Restart Grants of £5 billion.
For the help businesses of all sizes, a new UK-wide Recovery Loan Scheme is available for loans between £25,001 and £10 million. To see them through to the next stage of recovery, asset and invoice finance between £1,000 and £10 million is also available.
For the support of theatres, museums and other cultural organisations in England, the Culture Recovery Fund is providing an extension of the Film & TV Production Restart scheme in the UK, with an additional £300 million.
Great Britain is offering Six months of extension of the £20 per week Universal Credit uplift, the Northern Ireland Executive receiving additional funding to match the increase. Across the UK, The Working Tax Credit claimants are eligible for a one-off payment of £500.
Businesses such as hospitality, accommodation and attractions across the UK have the Extension to the VAT cut to 5% till the end of September 2021, followed by 12.5% rate for the next six months till March 31st 2022.
Businesses such as retail, hospitality and leisure sectors in England will benefit from business rates relief, 750,000 businesses are now eligible.
The government has extended the apprenticeship hiring incentive in England till September 2021 with an increase of payment to £3,000.
The new “flexi-job” apprenticeship programme in England enables apprentices to work with multiple employers in one sector, along with £7 million grant.
For 40,000 more trainees in England, the government has granted an additional £126 million for funding high-quality work placements and training programs for the ages between 16 and 24 years in 2021/22 academic year.
The government has increased the legal limit for single contactless payments from £45 to £100.
The government has increased the support to veterans with mental health needs across the UK to £10 million.
To tackle domestic abuse in England and Wales, the government has allocated £19 million for funding of a network of ‘Respite Rooms’ to support homeless women and a programme to prevent re-offending.
A fund of £90 million will support the government-sponsored national museums in England due the financial impact of Covid-19.
A fund of £300 million for major spectator sports, supporting clubs and governing bodies in England as fans return to stadia.
Employers of small and medium-size companies in the UK can continue to reclaim up to two weeks of eligible Statutory Sick Pay (SSP) costs per employee from the Government.
The government is extending the loss carry back rules worth up to £760,000 per company to support the cash-flow of businesses.
The government has created new Taxpayer Protection Taskforce to crack-down on COVID fraudsters who have exploited UK Government support schemes with £100 million.

3 – Strengthening the Public Finances

The government aims to maintain the income tax Personal Allowance and higher rate threshold from April 2022 until April 2026.
The rate of Corporation Tax will increase to 25% by the year 2023, to balance the need to raise revenue and keeping the tax system competitive internationally. This rate of tax is lowest in the G7 countries. Business with profits above £250,000 will only will have to pay the new tax slab of full 25%, businesses earning profits above £50,000 and below £250,000 will have a variable tax rate between 19% to 25%. Businesses with profits of £50,000 or less will continue to be taxed at 19%.
The government will maintain the current level of inheritance tax thresholds until April 2026.
Duties on the fuel will the frozen for the 11th consecutive year.
Duties on the alcohol will remain same across the board for the second year in running, saving alcohol consumers £1.7 billion.
SME payable R&D tax credit amount is under a limit now, the business can receive in any one year at £20,000 (plus three times the company’s total PAYE and NICs liability).
The Lifetime Allowance will remain at its current level of £1,073,100 until April 2026.
There will be no change adult ISA annual subscription limit of £20,000 for 2021-22.

4 – An Investment-Led Recovery

The new super-deduction will cut companies’ tax bill by 25p for every pound they invest in new equipment starting from April 2021. The super-deduction will be in full effect, this will worth around £25 billion to UK companies over two years times.
East Midlands Airport, Felixstowe & Harwich, Humber, Liverpool City Region, Plymouth, Solent, Thames and Teesside will have eight new English Freeports.
UK-wide ‘Future Fund: Breakthrough’ will invest in highly innovative companies such as those working in life sciences, quantum computing, or clean tech £375 million, the aim is to raise at least £20 million of funding.
Ambitious UK businesses will try to attract the brightest and best international talent trough the reforms to the immigration system.
Government of UK will try to provide a digital and management boost to up to 130,000 companies across the UK trough a new Help to Grow Scheme.
The government plans an investment of £25 million for UK grassroots sports, enough for around 700 new pitches as well as £2.8 million support for UK and Ireland bid to host the 2030 World Cup.
To ensure UK remains a competitive location for innovative research, the government is launching a review of Research & Development tax reliefs.
UK government aims to provide electrical power in every home by 2030, a £20 million to fund a UK-wide competition to develop floating offshore wind demonstrators.
An allocation of fund of £68 million for UK-wide competition to deliver first-of-a-kind long-duration energy storage prototypes that will reduce the cost of net zero by storing excess low carbon energy over longer periods.
Biomass Feedstocks Programme in the UK will receive a £4 million fund to identify ways to increase the production of green energy crops and forest products that can produce energy.
The government will publish ‘Build Back Better: our plan for growth’.
The government will provide a further funding of over £1 billion to 45 towns through the Town Funds for support of their long-term economic and social regeneration and their immediate recovery from the effects of COVID-19.
A66 Trans-Pennine upgrades will be in place with £135 million.
In the year 2022, the government will deliver a major celebration for the UK trough a £28 million to fund the Queen’s Platinum Jubilee celebrations.
To tackle climate change and other environmental challenges, the government will finance critical projects with at least £15 billion of green gilt issuance in the coming financial year. This will also fund important infrastructure investment and create green jobs across the UK.
Community Ownership Fund will protect pubs, theatres, shops, or local sports clubs with £150 million across the UK.
The government plans the transformation of local cultural projects in Hartlepool, Carlisle, Wakefield and Yeovil with £18.8 million.
The government will publish the prospectus for the £4.8 billion UK-wide Levelling Up Fund, providing guidance for local areas on how to submit bids for the first round of funding starting in 21-22.

5 – Scotland, Wales and Northern Ireland

The UK government will continue the support for individuals and businesses in Scotland, Wales and Northern Ireland via the Coronavirus Job Retention Scheme, self-employment grants, loan schemes and VAT cuts. The Barnett funding has been in issued to the devolved administrations to provide support the areas of devolved responsibility.
As per the Barnett formula, the Budget confirms an additional £2.4 billion for the devolved administrations for 2021-22. This is an additional £1.2 billion for the Scottish Government, £740 million for the Welsh Government, £410 million for the Northern Ireland Executive.
Apart from the Barnett formula, the devolved administrations will also receive an additional £1.4 billion of funding in 2021-22.
For the first stage of The North Sea Transition Deal, the construction will begin with £27 million in the Aberdeen Energy Transition Zone and £5 million in the Global Underwater Hub in Scotland.
Three Growth Deals in Scotland–Ayrshire, Argyll & Bute, and Falkirk will receive funds more quickly in the future.
A demonstration hydrogen hub in Holyhead, Anglesey, will be built with a support of £4.8 million.
Global Centre for Rail Excellence in Wales will receive Up to £30 million.
The Three City and Growth Deals–in North-Wales, Mid-Wales and Swansea Bay will receive funds more quickly in the future.
Northern Ireland Housing Executive will benefit from exemption of Corporation Tax in Northern Ireland.
The government has already issued almost half of the £400 million from the New Deal for Northern Ireland funding. These are funds are subject to business cases such as for making trading arrangements for supermarkets and small traders and provision of a new management system, improvement of the medicine supply chains, promotion of the Northern Ireland’s goods and services overseas, and support of skills development programs.
Tackling Paramilitary Programme in 2021-22 will receive an additional £5 million.