The cost to the taxpayer of Covid by the end of the next financial year is predicted to be £407 billion, much of which has been funded by debt.
Following Rishi Sunak’s budget announcement earlier today the temporary reduced rate of 5% VAT for the Tourism and Hospitality Sectors has been extended for a further 6 months until 30th September 2021. Furthermore, an interim rate of 12.5% will be introduced for the sector from 1st October 2021 until 31st March 2022. Thereafter the standard rate of VAT will apply again.
As we find ourselves in another National lockdown, businesses may be questioning whether we will see another delay to the implementation of the IR35 Off-Payroll Working changes due to come in from April 2021. This however is wishful thinking as we hear the Government has pledged its commitment to introducing the rules as planned with Parliament having already passed the legislation.
The construction sector has experienced a sustained period of challenge, the weak period of trading many experienced Q2 to Q3 2020 due to Covid has caused finance challenges to continue. Whilst some of these challenges were relieved by good cash management, payment holidays and changes to compliance requirements, the upcoming 2021 Budget announcement and the ongoing Covid problem means now is the time to ensure you are best placed to overcome any impending hurdles.
Before the scheduled Autumn budget, advisors and taxpayers alike were bracing themselves for a hike in the rate of Capital Gains Tax (“CGT”) as well as the very real possibility that some reliefs might be withdrawn altogether. For example Business Asset Disposal Relief (“BADR”), known previously as Entrepreneurs’ Relief. When the budget was pushed back to Spring there was an audible sigh of relief but with a number of recent budgets containing surprise announcements, it is important to consider any possible changes ahead of budget day on 3rd March.
Following our previous blog on the personal tax impact of Brexit, it seems those who own property in France or Spain may be particularly affected by Brexit.
