13th March 2020
The Primary threshold for Employee’s National Insurance increases to £9,500. This will save an Employee on average £104 per year in National Insurance contributions.
The Secondary threshold which Employer’s pay has only increased by £156 so this will save on average £21 per employee in Employer National Insurance contributions.
This is to increase from £3,000 to £4,000 for the 2020/21 tax year for eligible businesses.
Statutory Sick Pay (SSP) changes due to Coronavirus (Employers)
Prior to the outbreak of Coronavirus, employees were only allowed to make a claim for SSP on their 4th day of absence from work. Due to the self-isolation advice from the Government and Public Health England, employees who self-isolate can now make a claim for SSP on their 1st day of absence.
The Government will cover the cost of the SSP payments (where the Company employs less than 250 employees) whereas previously the cost was covered by the Employer.
Statutory Sick Pay (SSP) changes due to Coronavirus (Self-employed)
If you are self-employed and not eligible to claim SSP, then you can claim contributory Employment Support Allowance (ESA). As above with SSP, ESA is claimable from the 1st day of self-isolation.
Business Interruption Loans
Loans of up to £1.2m will be accessible for businesses affected by the disruption caused by staff absences due to self-isolation.
The planned reduction in Corporation Tax has been scrapped and it was confirmed that the main rate of Corporation Tax will remain at 19% for the next two years.
Due to be abolished for business in the retail, leisure and hospitality sectors were their rateable values are below £51,000.
High Street business rates to be reviewed later in 2020.
Small Business Rates Relief – Cash Grant
Businesses currently receiving the Small Business Rates Relief will receive a £3,000 cash grant.
Further information will follow as to how this cash grant is claimed and received.
In a major shock announcement, the Chancellor slashed the lifetime allowance for Entrepreneurs Relief from £10m to £1m.
Gains up to £1m will still be taxed at 10% but any further gain over and above this will be taxed at 20%.
VAT on the sale of digital publications, e-books and academic journals will be scrapped from December 2020.
It was also confirmed that the 5% tax on sanitary products will be scrapped from 1st January 2021.
A plastic packaging tax will be introduced from April 2022. Manufacturers and importers whose packaging products have less than 30% recyclable materials will be charged £200 per tonne.
Landfill tax was also increased by £2.80 per tonne for standard rated waste and £0.10 per tonne for lower rated waste.
Red Diesel Subsidies
Subsidies for fuel used in off-road vehicles (known commonly as Red Diesel) will be scrapped for most sectors in two years.
Subsidies for farmers and rail operators will however stay in place.
Capital Gains Tax (CGT)
The CGT allowance was increased from £12,000 to £12,300 from the start of the new tax year (6th April 2020).
Also, from the start of the new tax year there is a requirement to report and pay tax on Gains relating to residential property sales within 30 days of the transaction date.
It is also worth remembering that although not a new announcement, Letting Relief will no longer be available for properties sold after the 6th April 2020 where the property was once your main residence and has since been let out.