Got five minutes to find out about today’s budget? Here’s my quick run down on what it means for the pound in your pocket.
Furlough scheme extended
Furlough is now being extended to the end of September. As an employee, you’ll still get 80% of your wages, up to £2,500 a month, for the time you don’t work.
But employers will have stump up and contribute 10% to the bill in July and 20% in August and September.
Support for the self-employed
There’s two more grants as part of the Self Employment Income Support Scheme.
The 4th one covers up to 80% of your ‘average’ trading profits over a three month period and worth up to £7,500. The 5th one will cover the period from May to July but look at how much you’ve lost. With this one, if your profits are down by more than 30%, you’ll still get the 80% grant, but if it’s less than 30%, you’ll get 30% of your profits.
This time round the scheme will cover another 600,000 people as it’s being extended to those who’ve submitted a tax return for 2019 – 2020.
However once again nothing in the way of any financial support for limited company directors.
Stamp duty extension
The current stamp duty ‘holiday’ is extended from the end of March to 30th June. Means no stamp duty to pay on the first £500,000 of your home’s price tag.
After that, the ‘nil rate’ band gets cut to £250,000 until the end of September, and then it’s back at its previous £125,000 level from October.
Boost for first time buyers
The Chancellor announced plans to, ‘turn generation rent into generation buy’.
First time buyers will be able to buy their first home with just a 5% deposit with a new Government Guarantee in place to protect lenders. Will be available on properties with a price tag of up to £600,00.
There’s no change in the rates of tax, national insurance or VAT.
The ‘personal allowance’; that’s the amount you can earn before paying tax, goes up from £12,500 to £12,570 next year and then gets frozen till 2026.
And the ‘higher rate’ allowance goes up from £50,000 to £50,270 next year and once again, it’s then frozen to 2026.
Inheritance Tax, Capital Gains Tax and the Pensions Lifetime Allowance are all frozen at their current rates till 2026.
Corporation tax hike
If you’re a limited company; then you’re going to see the rate of corporation tax go up from 19% to 25% from April 2023. While it was rumoured to be going up; this is far higher than the 23% that was expected.
However small limited companies with profits of £50,000 or less will stay paying the 19% rate.
Minimum wage goes up to £8.91 an hour from April and the £20 Universal Credit weekly ‘uplift’ will be extended for another six months.
And if all this has got you reaching for a G&T, well a tiny glimmer of good news in that alcohol duty is frozen, so your bottle of plonk shouldn’t cost you any more at the till. Oh and fuel duty’s frozen too, so you shouldn’t pay more at the pump tomorrow.