Individuals

• No increases in income tax rates, capital gains tax or inheritance rates.
• From 6 April 2021 the income tax basic rate limit will increase to £37,700 and the higher rate threshold will increase to £50,270. The personal allowance will increase to £12,570. These limits will be frozen until April 2026.
• The inheritance tax nil rate band of £325,000 and residence nil rate band of £175,000, as well as the pension Lifetime Allowance of £1,073,100 will be frozen until April 2026. 
• The Capital Gains Tax annual exempt amount will remain at its current level until April 2026.
• The increased SDLT nil rate band for purchases up to £500,000 has been extended until 30 June 2021. This will decrease to £250,000 until 30 September 2021 and then return to £125,000.
• A new penalty regime for VAT (from 1 April 2022) and income tax (6 April 2023) will be introduced. The new points-based late submission regime will be introduced with a £200 penalty for every late submission and a revised regime for late payment of tax.   

Businesses

• The main rate of corporation tax will remain at 19% until April 2023.
• From April 2023 the main rate increases to 25%, with a Small Profits Rate of 19% for profits not exceeding £50,000. There will be marginal relief for profits between £50,000 and £250,000 (these thresholds are proportionately reduced for the number of associated companies and short periods). Family investment companies will not qualify for the 19% rate.
• Between 1 April 2021 and 31 March 2023, expenditure on new plant and machinery will qualify for a 130% super-deduction. Expenditure on assets in the special rate pool (such as integral features in buildings and certain cars) will benefit from a 50% first year allowance. The £1 million annual investment allowance limit for expenditure on plant and machinery will be extended until 31 December 2021.
• For the next two years the period over which businesses may carry back trading losses is temporarily extended from one to three years. The maximum carry back is for £2 million for each year.
• From 1 April 2021 the amount of SME payable R&D tax credits will be capped at £20,000 plus three times the company’s total PAYE and NICs liability.
• From 1 June 2021 withholding taxes will apply to payments of annual interest and royalties to EU companies subject to the terms of the relevant double tax agreement.

Employers

• The furlough scheme will be extended until 30 September with employees receiving 80% of their wages. Employers to contribute 10% from July rising to 20% in August and September.
• Two further payments will be made under the Self Employed Income Support Scheme (SEISS), with the payment in May based on 80% of average profits and a further payment in July. The newly self-employed who filed a 2019-20 tax return before today can claim these fourth and fifth SEISS grants.
• The off-payroll working (IR35) rules announced in Budget 2018 and delayed last year will go ahead from 6 April 2021 as planned.
• A £3,000 incentive in England for new apprentice hires until September 2021. 

VAT and indirect taxation

• VAT registration threshold will remain at £85,000 until 31 March 2024.
• The 5% rate for hospitality, accommodation and attractions has been extended until 30 September 2021. This will increase to an interim rate of 12.5% until the end of March 2022 before returning to 20% from April 2022.