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Chancellor Rishi Sunak made his Budget 2021 speech on 3 March 2021, the highlights of the speech as as follows: 

Highlights

Much has changed due to the coronavirus: there has been £208 billion of government support during the crisis, £350 billion of support is now being announced, total fiscal support will be £407 billion.

The UK's economy shrunk by 10%, the highest borrowing since wartime (WW2) totalling £355 billion.

The chancellor proposes a three-part plan:

  1. The government will continue to support the economy through Coronavirus.
  2. Once on the road to recovery, the public finances will need fixing
  3. Using lower interest rates to invest in capital projects

The Office of Budget Responsibility (OBR) expects the economy to recover by mid-2022. However, in five years time, the economy will still be 5% smaller than otherwise.

The question is how to balance support with fixing public finances.

To protect jobs during coronavirus

Other support

New business re-start grants

A new recovery loan scheme

Business rates

VAT Hospitality and Tourism

Stamp Duty Land Tax

Homebuyers:

Income Tax

Tax personal allowance will increase next year (6/04/21):

The rates will be frozen until 2026 and no longer increase with inflation.

From 2026: 

Other allowances are also frozen:

Corporation Tax

 Losses

New Super deduction for companies

Duties

Funding and investment models

Help to grow

Science and innovation

 Increased funding for devolved administrations

A levelling up fund

Freeports

Useful guides on this topic

Budget 2021: At a glance
A summary key budget announcements together with items published without announcement.

Budget 2021: Subscriber guide
A detailed guide with links to more detail on all the key topics for SMEs and their owners.


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