Spring Budget 2020: A brief overview

Just four weeks into the job as Chancellor, Rishi Sunak has delivered not only his first Budget, but also the UK’s first Budget for 47 years as a non-EU member.

Quite an achievement for the 39 year-old, who has opened the spending and borrowing taps to create an infrastructure revolution.

The Treasury’s coffers are going viral, and not just because of Covid-19.

We have pulled out the key announcements from the Budget.

Further analysis will be available later.

Brief recap – key changes previously announced

  • Corporation tax to remain at 19%
  • NICs primary threshold and lower profits limit increased to £9,500.
  • April 2020 – National Living Wage will rise from £8.21 to £8.72
  • VAT threshold frozen at £85,000
  • Employment allowance – from April 2020 reformed for NI bills below £100,000
  • CGT private residences relief – final 18 months exemption reduced to 9 months
  • CGT – 30 days to pay tax on sale of a UK residential property.
  • IR35 roll out to private sector from April 2020 will apply to large and medium sized businesses, with a soft landing.
  • Extra money for councils for social care, etc.

Spring Budget 2020 key measures announced

  • SSP for those who are advised to self isolate
  • Temp removal of minimum income floor for universal credit
  • SSP refunded in full for up to 14 days (employers with less than 250 staff)
  • Covid-19 business interruption loan scheme from banks
  • Abolishing business rates for cinemas etc for one year
  • 100% business rates retail discount extended to public venues
  • Fundamental review into business rates system
  • Cash grants to smallest business rate payers (max £3,000 per business)
  • Employment Allowance increased from £3,000 to £4,000 from April 2020
  • Tampon tax abolished from 1 January 2021
  • Cancelled planned increase in spirit duty, beer & other alcohol
  • Business rate discount increased from £1,000 to £5,000
  • Fuel duty remains frozen
  • Entrepreneurs Relief – Lifetime limit reduced from £10m to £1m from 11 March 2020
  • Increase in R&D investment to a record £22bn a year
  • Plastic packaging tax from April 2022
  • Red diesel – tax relief abolished for most sectors (agriculture not affected)
  • £600bn available for infrastructure spending
  • New funding for schools
  • Abolish VAT on digital publications by December 2020
  • April 2021 – 2% Stamp duty surcharge for foreign buyers
  • New tax crackdown on anti-avoidance measures
  • Pensions tax system – taper threshold increased by £90,000 to £200,000
  • Spending review to be carried out in the summer

Finance Bill 2020

The Finance Bill will be published on 19 March 2020, together with explanatory notes.