March 2020 Budget


What did it mean for Business?

Reports in the last month had led many to speculate about whether Entrepreneurs’ Relief might be abolished by the Chancellor. Instead, he opted to retain Entrepreneurs’ Relief but to reduce the lifetime allowance from £10 million to £1 million with immediate effect.

Corporation Tax is frozen at 19 per cent, instead of pressing ahead with the previously planned cut to 17 per cent.

Employment Allowance will increase by a third to £4,000 from April, cutting the tax bill for almost half-a-million small businesses.

Meanwhile, he said the rate of R&D Tax Credits would rise from 12 per cent to 13 per cent and that the Government will consult on whether qualifying costs should include investments in data and cloud computing.

Following on from his announcement about business rates concerning covid-19, the Chancellor also said that the whole system of business rates will be reviewed this year.

The commitment to raising the National Living Wage was asserted by suggesting that it is likely to be around £10.50 an hour by 2024

Personal taxes, pay and duties

NICs threshold raised from £8,632 to £9,500 – a measure that was included in the Conservative Manifesto.

The scrapping of the five per cent rate of VAT on women’s sanitary products was a welcome announcement, and one that was tabled prior to the 10th March.

Non-UK residents will be faced with a two per cent Stamp Duty Land Tax (SDLT) surcharge from April next year, in a move the Treasury says is to control house price inflation.

Meanwhile, he said the rate of R&D Tax Credits would rise from 12 per cent to 13 per cent and that the Government will consult on whether qualifying costs should include investments in data and cloud computing.

Pensions tapered annual allowance thresholds will both be increased by £90,000 to £200,000. Therefore from April, the tapered annual allowance will not affect people with an annual income of less than £200,000 – the “threshold income”. Only where an individual has an “adjusted income” of £240,000 or more will the annual allowance begin to taper down. At the same time, those with a total income of £300,000 or more, including pension accrual, will see the minimum amount the annual allowance can taper to fall from £10,000 to £4,000.

The lifetime allowance for pensions will rise in line with the Consumer Prices Index in 2020-21 to £1,073,100.

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