The Chancellor announced a raft of measures in the Budget. Discover RSM’s insights on the potential impact to individuals and businesses.
Your easy-to-use comprehensive guide to all the tax rates, facts and figures you need to know.
The announcement of an increase in the rate of corporation tax rate from 19 per cent to 25 per cent was certainly the most eye-catching corporate tax measure and was probably the most important point in the 2021 Budget. However, there were some relieving provisions that will lessen the impact in the short term and encourage businesses to invest.
Good – but really needed news – in the Budget for the UK's hospitality sector as the expected extension to the temporary 5 per cent reduced rate until October 2021 is confirmed. The new 12.5 per cent reduced rate until April 2022 was a surprise. As was the creation of eight freeports later this year and businesses involved in international trade must consider how will affect them. Finally, harmonisation on some aspects of the VAT penalty regime were confirmed.
In the build up to the Budget, individual taxpayers may have been bracing themselves for increases in capital gains tax, the introduction of a wealth tax and a wider change to capital taxes, which would have increased the annual tax burden significantly. In the end, it was not so; it seems that individual taxpayers have had a reprieve and most of the tax burden has fallen on corporates.
Unsurprisingly the Chancellor’s announcements did not include any significant changes to employment taxes given the challenging economic situation of many of the big-employee sectors. The tax information and impact notes did however, include a technical change to the off-payroll working rules (IR35) which are being introduced from 6 April 2021, and some welcome easements and extensions to previous exemptions introduced because of the coronavirus.