Today the 2021 budget was announced for the UK - so what does this mean for you and your business?
Firstly - apologies - I'm going to throughout this blog quickly with what you need to know now, so you can digest - but do keep an eye on our Instagram page @bluearrowacc for more updates as they happen.
Income TAX and Allowances
There are NO changes to income tax, NI or VAT... (hospitality is staying at 5% until September, but that's by the by).
This means the personal allowance is staying put at £12500 until 2022... it will then go up to £12750 until 2026.
Higher rate increases from £50k to £50270 in 2022.
Inheritance tax, pension lifetime allowance stay the same for 2 years.
Furlough extended until September 2021.
SEIS for Self Employed
More self-employed people will be able to obtain a grant this year - in fact 600,000 more.
The SEIS grants 4 & 5 -
4th Grant: 80% of average trading profits up to £7500
5th Grant: May - September 2021 based on 3 month average profits BUT:
If your turn over fell:
MORE than 30% = Receive 80% grant
LESS than 30% = Receive 30% grant
Corporation Tax....
Not as bad as it looks depending on where you are at financially in your business.
Companies that have profits over £50,000 will see a rise to 25% in 2023. If you have profits under £50k you stay at 19%.
Growth Funding
Quite an exciting one here; the government are investing in a Help to Grow scheme to develop executive management skills and digital skills in businesses, with 90% and 50% funding towards them.
Eligibility requires you have a Ltd company for over a year, and 5 employees on payroll,
Loans
CBILS are ending March 31st and being replaced with the new Recovery Loan Scheme. A business of any size can apply for £25k - £10m. Also Asset and invoice finance opportunities.
Overall it's a good sign, but it's still so important to be keeping your numbers up to date weekly (yes, weekly) and checking your figures. If you have any bounce backs or lending that kicks in this summer, make sure you have a cashflow forecast done to anticipate what you need to pay back.
Any questions? hello@bluearrowaccounting.co.uk