Spring 2020 Budget: What Small Businesses & Individuals Need To Know
Rishi Sunak, the newly appointed Chancellor of the Exchequer, has delivered his first Budget to the House of Commons. The 2020 Budget contains changes to National Insurance thresholds, broadband, infrastructure spending and pensions.
2020 Budget Supporting Public Services, Individuals & Business
Taking place against the backdrop of the global outbreak of Covid-19, the 2020 Spring Budget is a step away from the usual austerity seen in the Conservative Government. The Budget sets out a plan to support the public services, individuals and businesses that may be affected by COVID-19.
At TurnerWarran, we understand how this budget may affect many of our clients – so we’ve compiled a video summary of the important changes taking place.
Click here to see all of our accountancy and business advisory services.
Our Head of Bookkeeping and VAT Lauren Keightley has discussed the changes brought into place by the 2020 Budget. Since we have left the EU the government has been able to abolish the VAT on sanitary products, and have also changed the Reading Tax – abolishing the VAT on e-publications.
The current VAT thresholds are going to remain the same for the next two years.
Keith Hunt, our Head of Taxation, explains how the CGT (Capital Gains Tax) Annual Exemption has been increased by £300 to £12,300 for 2020 / 2021.
There have also been changes made to the PPR (Principal Private Residence) Relief. Coming into effect from the 6th April 2020, the final period of deemed ownership has been reduced from 18 months to 9 months. In regards to Tax being done Digitally, the rules are all remaining the same – if you’re a VAT registered business with turnover above £85,000 you’ve got to keep your records digitally.
As many SME’s can have manual and therefore outdated accountancy methods we can help or assist this transition to digital in many ways.
Employers & Employees
Sharon Hope, our HR & Payroll manager starts her analysis by reminding us all about the increases to the National Living Wage. By the hour:
- Apprentice pay is rising by 25p from £3.90 to £4.15,
- Under 18’s pay is increasing by 20p from £4.35 to £4.55,
- 18 to 20 years is increasing by 30p from £6.15 to £6.45,
- 21 to 24 year olds are rising by 50p per hour from £7.70 to £8.20 and
- people over 25 years old will see a 51p increase from £8.21 to £8.72.
The employment allowance has been increased to £4,000 from April, from the £3,000 this coming year – meaning that smaller employers will benefit from not having to pay HMRC and the employers NIC’s until they reach that £4,000. Employers do have to ensure they meet the criteria for this – contact us for any further clarification as we will be reviewing all our clients to ensure no one is paying more than they need to.
There are benefits put in place to protect SME’s and the hospitality industry. These include a £3,000 grant for businesses that are at present on rate relief. There are increases on allowances given to pubs from £1,000 to £5,000, and shops and cafes will no longer pay business rates.
We’re here to help and advise our clients on any relief or benefits they may be entitled to. If you have any queries regardless if you are a TurnerWarran client, please contact our accounting team to find out if you are eligible for any financial assistance.
We also have a PDF version of our 2020 Budget summary.