3 Mar, 2021
Find out the latest business support announced by Chancellor Rishi Sunak in the 2021 Budget.
Fighting the coronavirus pandemic has cost the Government over £270bn in borrowing which needs to be paid back whilst also continuing to support millions of people and businesses hit by the crisis.
In the past 12 months, 700,000 people have lost their jobs and the economy has seen its biggest fall in 200 years. However, we are expected to return to pre-pandemic levels by mid-2022 which is six months earlier than originally predicted by The Office for Budget Responsibility.
Here are the key points for businesses:
The Furlough Support Scheme will be extended until the end of September meaning employees will continue to receive 80% of their salary, up to a maximum of £2,500. However, as of July, employers will be asked to contribute 10% to workers’ salaries, increasing to 20% in August and September.
Last year a business rates holiday was brought in to support shops until 31st March 2021. This has now been extended until June and for the remaining 9 months, discounted by two thirds, up to a value of £2m for closed businesses. A lower cap will be available for those who have been able to stay open.
Corporation Tax is set to rise from 19% to 25% from April 2023. The Government will also be creating a Small Profits Rate to ensure only businesses with profits over £250,00 will be taxed at the 25% rate.
Income Tax will remain the same, however the basic rate will rise to £12,570 and £50,270 for higher-rate payers next year. These will remain in place until 2026.
Cash grants of up to £7,500 will be available to the self-employed including those who started working for themselves during the financial year of 2019-2020.
Re-start Grants of up to £18,000 will be available to businesses in the retail, hospitality, accommodation, leisure and personal care sectors, supporting them with re-opening after lockdown.
Eligible companies will be offered free MBA-style management training to help boost productivity growth. In addition, they will also be able to claim up to £5,000 each to secure a 50% discount on productivity-enhancing software.
The Government currently pay businesses £2,000 per trainee, however this will rise to £3,000.
A ‘flexi-job’ apprenticeship scheme will also be introduced in England to enable apprentices to work for a number of different companies in one sector.
For further information on the Budget and business support, please visit the Government website.
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