2020 Budget review: Whatever it takes to support the UK Economy
Our new Chancellor has delivered the long-awaited Budget after less than a month in office. Rishi confidently announced measures to address the economic challenge of COVID-19 whilst delivering a budget that provides ‘security today’ and a ‘plan for prosperity’ tomorrow.
Key announcements were:
- From 11 March 2020, the reform of the 10% Entrepreneurs’ Relief CGT tax rate reducing the lifetime allowance to £1m will substantially increase CGT payable on business disposals, but it’s not been abolished.
- The welcome and unexpected introduction of an increase in income thresholds for pension savings. From April 2020, those earning up to £200,000 can make pension savings of up to £40,000 annually; those earning over £300,000 can only pay £4,000.
- As expected, Corporation Tax remained at 19% although tax reliefs for expenditure on structures/buildings and R&D marginally increase.
- Non-UK-residents purchasing UK property will pay an additional 2% in SDLT from April 2021
- The ability for small businesses to reclaim up to 14 days of Statutory Sick Pay (SSP) from the Government for sickness absence due to COVID-19
Following the recent Government review, the off-payroll working rules are still to be implemented from April 2020 and CGT will be reportable and payable to HMRC on the disposal of residential property within 30 days from completion.
We’re still expecting Inheritance Tax to be reformed and wonder what its impact will be on our client’s existing arrangements and future plans…
Despite all odds, it is predicted that the UK economy will grow. This budget will be followed by a Spending Review and very likely, another Budget in November.
If you miss Sarah Tucker and Nicola Valentine reviewing the 2020 Budget with Neil Whiteside on Cambrige 105 you can listen again.
We live in uncertain times. CKLGs tax advisers offer a proactive and bespoke service to help you along your journey, call our Cambridge Tax team on 01223 810100 to discuss how Budget 2020 may affect your plans.