Budget 2020

The newly appointed Chancellor, Rishi Sunak, delivered the 2020 Budget this afternoon in the House of Commons, splitting this into two areas; the first focused on support to combat Coronavirus and the second on the Main Budget. We have summarised the main headlines in this article:

Coronavirus

  • £30bn of additional stimulus was announced to combat the impact of Coronavirus on businesses and individuals:
    • Individuals will be eligible for statutory sick pay from day 1
    • The Government will fund Statutory Sick Pay in full for 2 weeks for businesses with less than 250 employees
    • A new coronavirus business interruption loan scheme will see banks offer loans of up £1.2m to support SME’s

Main Budget

Infrastructure

  • £12.2bn to help build affordable homes across the country
  • Over £1bn for infrastructure to build nearly 70,000 new homes
  • £6bn of new funding to support the NHS to deliver 50,000 more nurses, 50m more GP surgery appointments and to build 40 new hospitals
  • £1.5bn of new capital over five years to improve FE college buildings and facilities
  • £510m to get 4G mobile coverage to all areas of the UK
  • £500m to support roll out of new rapid charging hubs, so drivers are never more than 30 miles from being able to charge their vehicle
  • £1bn building safety fund to remove dangerous cladding
  • £2.5bn over next five years to fix potholes and maintenance of roads

Businesses

  • Cash grants of £3,000 to any business currently eligible for small business rates relief
  • Entrepreneurs relief lifetime limit reduced from £10m to £1m
  • Increasing investment in R&D to £22bn a year, the largest and fastest increase in R&D investment on record
  • £5bn of new export loans for businesses
  • £130m of new funding to extend start up loans for entrepreneurs in 2021-22

Climate

  • From April 2022, manufacturers and importers will be charged £200 per tonne on packaging made of less than 30% recycled plastic
  • £5.2bn over next 6 years for flood and coastal defences

Tax and benefit changes

  • Research and Development Expenditure Credit (RDEC) rate increased from 12% to 13%
  • Structural and Building Allowances (SBA’s) increased from 2% to 3%
  • Employment Allowance increased from £3,000 to £4,000
  • The National Insurance threshold will be raised £8,632 to £9,500 from next month, giving 31 million individuals a tax cut
  • Corporation Tax rate will remain at 19%
  • Fuel duty remains frozen along with all alcohol duties
  • Reading tax abolished from 1st December 2020
  • Diesel tax relief abolished
  • 2% stamp duty surcharge for non-UK residents
  • A one-year break from NI contributions for employers of veterans
  • Abolishment of tampon tax from 1stJanuary 2021

Innovation Tax specialise in helping companies access vital funding and tax incentives to enable their businesses to grow, increase profitability, reduce risk and enable further investment in R&D and capital investments.

Like this article?

Share on facebook
Share on Facebook
Share on twitter
Share on Twitter
Share on linkedin
Share on Linkdin
Share on email
Share on Email
Share on whatsapp
Share on WhatsApp