A brief 2021 budget summary
Whilst the budget contains a great deal of information, we have created a brief 2021 budget summary for small businesses.
On 3 March 2021, Chancellor Rishi Sunak announced his 2021 budget containing his road to recovery.
This announcement saw more support for businesses suffering due to the pandemic with extensions to the furlough scheme and the 5% reduced rate of VAT together with including more self-employed people being eligible for the self-employed income support scheme.
The budget also included tax increases we will be facing in future years to balance the economy with most tax allowances being frozen until 2026 and the VAT registration limit frozen for two years.
Companies will face higher corporation tax liabilities from 2023 if their profits exceed £50,000 paying 25% for all profits over £250,000. Perhaps as a sweetener for this increase, there will now be a super deduction available from April 2021of 130% of expenditure on new equipment for two years and the ability for companies to carry back their losses over 3 years instead of 1 to create a larger tax refund which will be welcome now to many who have struggled through the pandemic.
For a full 2021 budget summary and a downloadable pdf click here.