Today’s Budget Announcement from the chancellor: -
Please see a headline view and changes that may impact landlords and also a summary below of the bigger picture as I’ve broken this down into each area to review and digest; -
No increase for Capital Gains Tax
Freezing personal tax thresholds.
Will be increased from April 2021 to £12,570, but frozen till April 2026
From 2023, the rate of corporation tax paid by the largest and most profitable businesses will increase. No change where profits are under £50,000
VAT registration threshold remains till 2024
Inheritance tax nil-rate band will be frozen until April 2026
Welfare - Universal Credit £20 a week uplift to be retained for 6 months. Exemptions to the Shared Accommodation Rate for care leavers up to the age of 25 and those under the age of 25 who have spent at least 3 months in a homeless hostel from June 2021.
But as my audience is more than just landlords I wanted to detail and summarise you all the key points that was outlined in today’s budget: -
Contactless Payment Limited Increased: -
The government has approved an increase to the legal contactless limit. This means you should soon be able to use your contactless debit and credit cards to make payments up to £100 (raised from £45) at any retailer that accepts contactless.
Once the changes are put in place – due to be later this year – you’ll be able to make £300 of cumulative contactless payments before needing to input your chip and pin.
Stamp Duty Holiday in England and North Ireland has been extended to the end of June 2021.
Until then SDLT will not be charges on the first £500,000 on the price of a residential property purchased in England and Northern Ireland. Please note – an extra 3$ SDLT will still apply if buying a property means you’ll own more than 1 Property.
After 30th June 2021, the threshold lowers to £250,000 until the end of September 2021. IT will return to £125,000 on 1st of October 2021.
This extension gives you more time to complete on a property and potentially on a property and potentially save money on the stamp duty bill.
Mortgage Guarantee to help buyers with 5% deposit.
The government has announced a 95% loan to value LTV mortgage guarantee scheme to help buyers purchase a property with 5% deposit.
The government mortgage guarantee scheme will make a real difference in enabling more first time buyers and move movers, with a minimum 5% deposit to get the keys to their new home.
This scheme will be available from the 19th April 2021.
Financial help for those affected by Coronavirus.
Job Retention Scheme Furlough Extension to end of September. It’ll continue to contribute up to 80% of wages employees on temporary leave due to Coronavirus.
New UK Wide Recovery Loan Scheme
As various business loan schemes come to an end including the bounce back loan BBLS a new recovery loan scheme will take their place until the end of 2021.if your business is eligible may be able to apply for a loan between £25,000 and 10 Million.
Personal and corporation tax
The personal tax threshold – the amount you can earn before starting to pay tax – will rise, as planned, to £12,570 from April 2021 and remain unchanged until April 2026. The higher-rate threshold will increase to £50,270 from April 2021 and remain unchanged until April 2026.
Corporation tax will increase from 19% to 25% in April 2023. However, the rate for companies with profits under £50,000 will stay at 19% and there will also be relief for businesses with profits under £250,000.
Support for the retail, hospitality and leisure sectors
Business rates relief will continue for those in the retail, hospital and leisure sectors until the end of June. Rates will then be reduced by two-thirds until the end of the year. This includes shops, restaurants, gyms and hotels. Businesses may also be eligible for a Restart Grant – a one off cash payment of up to £18,000.
Self-employed support
The government has issued a fourth grant as part of the Self-Employed Income Support Scheme (SEISS). If you filed a tax return in 2019-20, you will now be able to claim for the first time. If your income has fallen by 30% or more, you could be entitled to a grant to cover 80% of lost earnings (30% if your earnings have fallen by less than 30%). The SEISS covers the months February, March and April 2021, up to the maximum value of £7,500.
£20,000 ISA allowance remains
The total amount you can save in ISAs in the 2021-22 tax year will stay at £20,000. This is your annual tax-free ISA allowance.
You can spread it across different types of ISAs, such as:
cash ISA
stocks & shares ISA
innovative finance ISA
But you can only have one ISA of each type and you must stay within the total limit of £20,000. If eligible, you can also put up to £4,000 into a Lifetime ISA, as part of this limit. The Junior ISA allowance will remain at £9,000.
Fuel and alcohol tax freeze
Fuel duty will remain the same for the 11th consecutive year. Tax on alcohol will also remain unchanged.
Could you be missing out on unclaimed benefits?
Many people are eligible for government support but don’t realise they are. You may think you need to be out of work to claim anything – but that’s not the case.