On 3 March 2021 Rishi Sunak, Chancellor of the Exchequer, delivered the Spring Budget setting out his plans as the United Kingdom starts to ease the lockdown and revealing the goals that he is looking to achieve after the pandemic.
Presenting the government’s spending plans for the year ahead, the Chancellor announced the new measures with the intention of helping businesses and jobs through these difficult times.
The measures are aimed at supporting the country’s long-term economic recovery as well as rebalancing the public finances with the help of tax rising.
Below is a summary of the key announcements for the private client world.
- The stamp duty holiday has been extended and will now end on 30 June instead of 31 March.
- The nil rate band will be £250,000 until the end of September. The government will return to the usual level of £125,000 from 1 October.
- The income personal allowance will increase to £12,570 from £12,500 for the 2021/22 tax year. The basic rate threshold will increase to £37,700 from £37,500.
- The income tax personal allowance and higher rate threshold are then to be frozen until April 2026.
- The starting rate limit for savings will remain at £5,000 for the 2021/22 tax year. This band of savings income is subject to the 0% starting rate.
- The Capital Gains Tax (CGT) annual exemption will remain at £12,300 for individuals and personal representatives until April 2026.
- The lifetime allowance on pension contributions has been frozen at its current 2020/21 level of £1,073,100.
- The annual ISA adult subscription limit will remain at £20,000, and the annual subscription limit for Junior ISAs will remain at £9,000.
- The government will continue supporting the country’s social enterprises that are looking for growth investment by extending the SITR scheme to 6 April 2023.
- The government will provide armed forces charities with up to £475,000 in the 2021/22 tax year to support the development of a digital and data strategy.
- The Armed Forces Covenant Fund Trust will receive additional £10 million in 2021/22 tax year for charitable projects and initiatives that support veterans with mental health needs across the country.
If you have any questions, please do not hesitate to contact James Cohen directly on [email protected] or 0207 822 2257.
© 2021 GSC Solicitors LLP. All rights reserved. GSC grants permission for the browsing of this material and for the printing of one copy per person for personal reference. GSC’s written permission must be obtained for any other use of this material. This publication has been prepared only as a guide to provide readers with general information on recent legal developments. It is not formal legal advice and should not be relied on for any purpose. You should not act or refrain from acting based on the information contained in this document without obtaining specific formal advice from suitably qualified advisors.