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Spring Budget Update 2020

Yesterday the Government gave this year’s first budget update. Here are some key points which may affect you:

Measures to mitigate the effects of Coronavirus:

  • £12 billion package of tax and spending measures including grants and hardship funds for people a businesses affected.
  • Statutory Sick Pay to be payable from first day’s absence and fully funded by the Government for 14 days.
  • Business rates relief for the next year increased from 50% to 100% for retail businesses with rateable values up to £51,000.

Tax measures with immediate effect:

  • Lifetime limit for gains eligible for Entrepreneurs’ Relief (taxed at 10% instead of 20%) reduced from £10m to £1m for disposals from Budget day.
  • Duty on alcoholic drinks and fuel frozen.
Tax year 2020/21:
  • No change to personal income tax allowances and rates: 2019/20 figures continue for a second year, as expected.
  • Increase in threshold for National Insurance Contributions from £8,632 to £9,500.
  • Research & Development expenditure credit increase from 12% to 13%.
  • Structures and Buildings Allowance increased from 2% to 3%

Tax measures coming into effect later:

  • VAT ‘Domestic Reverse Charge’ on construction services, deferred from 1st October 2019, confirmed introduction on 1st October 2020.
  • VAT zero-rating to apply digital versions of newspapers and books as well as printed versions from 1st December 2020.

Click here to view our full Budget Summary document.

As you would expect we are taking reasonable measures to prevent the spread of Coronavirus to protect our clients and staff. Therefore we have decided to digitalise our Budget Update seminar and we will be recording and sending this out to you via email.

If you have any questions regarding the governments steps to mitigate the impact of COVID-19 or anything else within the budget summary,  please don’t hesitate to contact us.

Ad Valorem Accountancy Services
01908 219100


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