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
