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Budget 2020 Update

11 March 2020

Below are the key points from today’s Budget that will have the biggest impact on our clients and their employees.

Corona Virus Response:

Extra support for the NHS to fight the virus – £5bn emergency response fund

Employees support:

  • Statutory Sick Pay (SSP) from day 1
  • SSP available to those who are told to self-isolate – even if they haven’t presented with symptoms
  • Government to meet cost of providing statutory sick pay for up to 14 days for workers in firms with up to 250 employees
  • More help for self-employed or those in gig economy through £500m welfare boost and new £500m hardship fund

Business Support:

  • ‘Business Interruption’ loans available to SMEs
  • Some industries benefiting from 1-year business rates abolition where rateable value is below £51k
  • £3,000 grant available to businesses eligible for small business rates relief

General Budget Update:

  • National Insurance threshold to rise from £8,632 to £9,500 saving employees and the Self-Employed, between £85-£100 annually
  • Corporation Tax to remain at 19%
  • The reduction of the lifetime limit for Entrepreneurs’ Relief from £10m to £1m

Changes to Pensions:

  • Threshold income for the tax year will be increased from £110k to £200k – this will help higher earners save for pensions with more tax efficiency
  • An intention to consult on the net pay tax relief issue to provide a solution for lower earners contributing to workplace pension schemes set up on this basis
  • An increase in the lifetime allowance. In 2020/21 the allowance will increase in line with CPI, rising to £1,073,100 – slightly higher than expected

Changes to finances from April 2020:

  • Those aged 25 and over will get the National Living Wage of £8.72 an hour, a rise of 6.2%, with younger workers also getting more
  • The full, new state pension will go up by 3.9% from £168.60 a week to about £175.20 in April

As always, if you have any concerns or questions regarding the above, please feel free to get in touch with us, as we are here to help.