Key Points from the Spring Budget
In the current climate, there is uncertainty in all of our lives with both health and financial concerns. However, while we are all understandably focusing on the here and now, it might be worth using this time to take a step back and review your long-term financial well-being as well. This newsletter takes a look at some of the areas you might want to consider. Of course, we are on hand to support you through any challenges ahead.
THE ECONOMY
- Economy predicted to grow by 1.1% in 2020-21, revised down from 1.4% forecast a year ago (this figure does not take into account the impact of COVID–19)
- Growth predicted to rebound to 1.8% in 2021–22, easing back to 1.5% in 2022–23
- Inflation forecast of 1.4% this year, increasing to 1.8% in 2021–2022
CORONAVIRUS AND PUBLIC SERVICES
- ￡5bn emergency response fund to support the NHS and other public services in England
- All those advised to self-isolate will be entitled to Statutory Sick Pay, even if they have not presented with symptoms
- Self-employed workers who are not eligible will be able to claim contributory Employment and Support Allowance (available from day one)
- ￡500m hardship fund for councils in England to help the most vulnerable in their areas
- Firms with fewer than 250 staff will be refunded for sick pay payments for two weeks
- Small firms will be able to access business interruption loans
- Business rates in England will be suspended for firms in the retail, leisure and hospitality sectors with a rateable value below ￡51,000
- ￡6bn in extra NHS funding over five years to pay for staff recruitment and start of hospital upgrades
PERSONAL TAXATION, WAGES AND PENSIONS
- The tax threshold for National Insurance Contributions will rise to ￡9,500 (previously announced)
- Tax paid on the pensions of high earners, including NHS consultants, to be recalculated to address staffing issues
- The two tapered Annual Allowance thresholds for pensions will each be raised by ￡90,000
- The minimum level to which the Annual Allowance can taper down will reduce from ￡10,000 to ￡4,000 from April 2020
- Annual Capital Gains Tax exemption increased to ￡12,300 from 2020–21
- ISA allowance to remain at ￡20,000 for 2020–21 tax year / JISA allowance increase to ￡9,000 for 2020–21 tax year
- The Lifetime Allowance for pensions will increase in line with the Consumer Prices Index, to ￡1,073,100 for 2020–21
- From 11 March 2020 the Lifetime Allowance on gains eligible for Entrepreneurs’ Relief reduced from ￡10m to ￡1m
- The new single-tier State Pension will increase to ￡175.20 per week in April 2020, pensioners receiving the older basic State Pension will see it increase to ￡134.25 per week.
The information within this article is for information purposes only and does not constitute advice.
Source: https://gp3fs.com/key-points-from-the-spring-budget/