Anna’s Accountancy Alerts – March 2020 Budget Highlights

Business

NIC Threshold Cut Confirmed 

It will go up from £8,632 to £9,500 from April. 

This will save the typical employee around £104 and a typical self-employed person around £78 in 2020-21. 

There is a formal target that by 2024 the NLW will be two thirds of median earnings, which on current forecasts would reach £10.50.

Personal Allowance Unchanged 

The personal allowance remains at £12,500 for both this tax year and 2020/21 and was left unchanged in the Budget

The income limit for the personal allowance also remains unchanged at £100,000 but the income limit for married couple’s allowance is set to increase from the current £29,600 to £30,200 in 2020/21.

Employment Allowance

The maximum Employment Allowance will be increased from £3,000 to £4,000 with effect from 6 April 2020.

Increase in the flat rate deduction for homeworking

The government will increase the maximum flat rate income tax deduction available to employees to cover additional household expenses from £4 per week to £6 per week where they work at home under homeworking arrangements. This will take effect from April 2020.

Corporation Tax Rate Kept At 19%

Originally the plan was to cut corporation tax by 2% from April 2020, but this was ruled out as soon as the Conservatives came to power last December.

Statutory Sick Pay Relief

Details on ‘temporary, timely and targeted’ measures for individuals who fall ill

For businesses with fewer than 250 employees the cost of providing SSP for up to 14 days will be refunded by the government in full. 

Statutory sick pay (SSP) will be available from day one for all those who are told to self-isolate. 

Those on contributory employment and support allowance will be able to claim from day one instead of day eight.

Support For Those Ineligible For SSP

Self-employed people and employees earning below the National Insurance Lower Earnings Limit are not entitled to SSP and will offer financial support to these individuals through a ‘new style’ Employment and Support Allowance and Universal Credit.

VAT On Digital Publications Abolished

No VAT will be charged on books, magazines or journals regardless of format from 1 December

HMRC Coronavirus Helpline Set Up

HMRC has a set up a dedicated phone helpline to support businesses and self-employed people concerned about not being able to pay their tax due to covid-19  

The helpline allows any business or self-employed individual who is concerned about paying their tax due to coronavirus to get practical help and advice.

Up to 2,000 experienced HMRC call handlers have been assigned to support businesses and individuals when needed.

The helpline is open for businesses and self-employed questions regarding due or late payment of tax due to coronavirus related issues.

The new HMRC helpline for help and advice is available at 0800 0159 559, and is an addition to other HMRC phone contact numbers.

For those who are unable to pay due to coronavirus, HMRC will discuss the specific circumstances to explore:

  • agreeing an instalment arrangement;
  • suspending debt collection proceedings; and
  • cancelling penalties and interest where you have administrative difficulties contacting or paying HMRC immediately.

The HMRC helpline number is 08000159559

Opening hours are Monday to Friday 8am to 8pm, and Saturday 8am to 4pm. The helpline will not be available on Bank Holidays.

Zero-Emission Cars Exempt From VED

As an incentive to reduce carbon emissions the Chancellor has announced that zero-emission cars registered from 1 April 2017 with a £40k price tag will be exempt from road tax

Structures And Buildings Allowance Rate Increased

A 1% increase in capital allowances under the structures and buildings allowance

Major Business Rates Review

For one year from 1 April 2020, the business rates retail discount for properties with a rateable value below £51,000 in England will be 100% and will be expanded to include cinemas and music venues. 

There is also £2.2bn of funding for local authorities to provide a £3,000 cash grant to around 700,000 businesses currently eligible for SBRR or rural rate relief, to help meet their ongoing business costs.

Coronavirus Business Interruption Loan Scheme

The scheme, delivered by the British Business Bank, will support businesses to access bank lending and overdrafts.

The government will provide lenders with a guarantee of 80% on each loan to give lenders further confidence in continuing to provide finance to SMEs.

The government will not charge businesses or banks for this guarantee, and the scheme will support loans of up to £1.2m in value.

Bank Of England Cuts Base Rate To 0.25% 

These measures will help to keep firms in business and people in jobs, and help prevent a temporary disruption from causing longer-lasting economic harm, the Bank of England said.

Stay Up-To-Date With Coronavirus & Brexit News

Coronavirus has affected us all. Whether you’re a sole trader, employer or employee. Stay up to date with the latest news – including government support, tax implications, and more.