The Chancellor, Rishi Sunak, presented the third Budget of his term on 27th October 2021. Branded as a Covid recovery-focussed budget, Mr Sunak said it would help deliver a “stronger economy for the British people”.
There was very little ‘new’ information in the Chancellor’s announcements due to the volume of leaked details ahead of budget day. However, we have set out our highlights below:
To reduce the burden of business rates in England, the government will:
Freeze the business rates multiplier from 1st April 2022 to 31st March 2023
Introduce a new temporary business rates relief for eligible retail, hospitality and leisure properties for 2022/23, giving a 50% discount in business rates, up to a ¬£110,000
National Insurance Contributions
In September 2021, the government published proposals for new investments in health and social care. The proposals will lead to a permanent increase in spending. To fund the investment, the government will introduce a 1.25% Health and Social Care Levy based on the National Insurance Contributions system from 6th April 2022. These funds will be ring-fenced for health and social care.
National Living Wage and National Minimum Wage
Following the recommendations of the independent Low Pay Commission, the government will increase the National Living Wage for individuals aged 23 and over by 6.6% from 1st April 2022.
Recovery Loan Scheme
The Recovery Loan Scheme, which was introduced to help businesses recover from the impact of COVID-19, will be extended until 30th June 2022.
Additional Research and Development tax relief announced
Research and Development (R&D) tax relief will be available for a broader range of business costs, including cloud computing and data. The Chancellor also revealed that from April 2023, more Research and Development tax relief would be available for UK projects.
Other Major Announcements
- * Individuals disposing of UK property on or after 27 October 2021 now have a 60 day CGT reporting and payment deadline, following the completion of the disposal
- * A change in the earliest age from which most pension savers can access their pension savings without incurring a tax charge. From April 2028 this will rise to 57
- * The retention of the £1 million annual investment allowance is available until 31 March 2023
- * The new dividend rates from 6 April 2022 will be 8.75% for basic rate taxpayers, 33.75% for higher rate taxpayers and 39.35% for additional rate taxpayers.
- * The 1.25% social care levy will increase both the main and additional rates of Class 1, Class 1A, Class 1B and Class 4 NICs for 2022/23
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