Autumn Budget 2021

Almost ten months after the UK left the EU, today, Wednesday 27 October 2021, the Chancellor, Rishi Sunak, delivered the Autumn Budget. His emphasis during the budget was to provide a stronger economy for the British people after the pandemic. Towards the end of the budget, he declared it is his mission to reduce taxes by the end of the current government.

Below are some of the announcements, more details will follow in the next few days:

Economy

  • Office Budget for Budget Responsibility (OBR) forecasts show that government recovery plan is working.
  • Estimated that inflation will reach 4% within the next year, up from the current 3.1%
  • OBR predicts that the UK economy will recover from the pandemic at a quicker rate than previously predicted.
  • National Living Wage to increase from £8.91 per hour to £9.50, an increase of 6.6%.
  • Real terms rise in public spend for all departments.

Business Tax

  • Current tax relief for the Arts sector doubled until April 2023.
  • R&D tax relief to focus on UK activities from April 2023, and cloud computing and data costs now eligible.
  • £1m Annual Investment Allowance to be extended to March 2023.
  • Business Rates
    • From April 2023 there will be more frequent valuation reviews, every three years.
    • New ‘Business Rates Improvement Relief’ will provide a 12-month relief for companies that invest in property improvements.
    • Next year there will be a 50% business rates discount for companies in retail, hospitality and leisure sectors, up to a maximum of £110,000.

Other Points

  • The Chancellor also announced that there will be a cut the taper rate in Universal Credit from 63% to 5% and that the work allowance will be increased by £500. This will be implemented as soon as possible and no later than 1 December 2021 This will be worth more than £2bn.

If you have any questions on the announcements, please contact us to discuss.

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