Rishi Sunak has noted it will take the UK "a long time to recover" but he will do "whatever it takes". Below are some key points from the budget earlier today for our sectors.
Private Client - Inheritance tax threshold, capital gains tax annual allowance, and pension lifetime allowance have all been frozen until April 2026.
Corporate & Commercial - The rate of corporation tax will increase to 25% from April 2023 for businesses with profits of over £250,000. There is a sliding scale of tax for profits between £50,000 and £250,000.
Real Estate –
- SDLT rates holiday extended: As expected, the Chancellor has extended the full SDLT holiday until the end of June 2021, with a part holiday in place until the end of September, lifting the pressure off thousands of buyers who were racing to complete their transactions this month. Then nil rate band will be double it’s usual level, so it will be £250,000 until 30th September and will then return to the usual band of £125,000 from October 1st.
- Business rates holiday extended: under pressure to reform the business rates system, the Chancellor has extended the holiday period pushing back the question of wider reform, including a tax on online-only retailers. As a result, ‘bricks and mortar’ stores have a longer period before they have to find the funds to pay what can be crippling business rates bills.
- Bringing back 95% mortgages: - the Chancellor re-introduced a mortgage guarantee scheme to help people with small deposits get on the property ladder, with many large lenders already backing the scheme. It is suggested that the new scheme is not restricted to first-time buyers or new-build homes, but there will be a £600,000 limit.
- CGT: Although the Chancellor’s position on this has not been clear in the last few weeks it seems he has decided against an increase in the rates of CGT. Clients selling property without the benefit of Principle Private Residence Relief, therefore, have at least until the autumn before they see an increase in the rate of tax they will pay on any gain.
Employment - The chancellor says furlough will continue until September, with no change of terms. After July, businesses will be asked for a 10% contribution, rising to 20% in August and September. Sunak says support for the self-employed will continue, with help targeted to those who have lost out most.
Family law - Rishi Sunak says domestic abuse has been one of the "hidden tragedies" of the pandemic and says he will provide an extra £19m for domestic abuse programmes.
The chancellor says he would do “whatever it takes” during the pandemic, and that he has done and will continue to do so.