St Helens Chamber is on hand to help you with every step on the road to recovery, and we have put together a summary of the key points from the latest budget announcement. We will publish further detail on all of the announcements as they become available.
Furlough scheme has been extended
Self Employed Income Support Scheme has been extended
Increasing Apprenticeship incentives to £3,000 for all new hires, of any age
Restart Grants to help businesses reopen and get going again
Culture Recovery Fund
A new Recovery Loans Scheme
The 100% business rates holiday will continue to the end of June
5% reduced rate of VAT for hard hit sectors extended for six months
In 2023, the rate of corporation tax, paid on company profits, will increase to 25%
The Super Deduction
Liverpool City Region Freeport Approved
Future Fund: Breakthrough
Launch of a National Infrastructure Bank
Help to Grow scheme for SMEs
Furlough scheme has been extended
The Coronavirus Job Retention Scheme has been extended until September 2021. Employers will be able to contact HMRC for a grant to cover most of the wages of people who are not working, but are furloughed and kept on payroll, rather than being laid off.
Employees will continue to receive 80% of their current salary for hours not worked, up to £2,500 per month. There will be no employer contributions beyond NIC’s and pensions required in May and June.
Employers will be expected to pay 10% towards the hours their staff do not work in July, increasing to 20% in August and September, as the economy reopens.
Self Employed Income Support Scheme has been extended.
A fourth SEISS grant covering the period February to April will be worth 80% of people’s average trading profits. The fifth and final grant from May will target support towards those most affected by the pandemic.
People who had filed tax returns for 2019-20 by 2nd March 2021 will now be eligible to apply for the fourth and fifth grants.
The fourth SEISS grant will be set at 80% of 3 months’ average trading profits, paid out in a single instalment, capped at £7,500. The fourth grant will take into account 2019 to 2020 tax returns and will be open to those who became self-employed in tax year 2019 to 2020. The rest of the eligibility criteria remain unchanged. Your eligibility for the scheme will now be based on your submitted 2019 to 2020 tax return. This may also affect the amount of the fourth grant which could be higher or lower than previous grants you may have received.
To be eligible for the fourth grant you must be a self-employed individual or a member of a partnership.
To work out your eligibility HMRC will first look at your 2019 to 2020 Self Assessment tax return. Your trading profits must be no more than £50,000 and at least equal to your non-trading income.
If you’re not eligible based on your 2019 to 2020 Self Assessment tax return, HMRC will also look at the tax years 2016 to 2017, 2017 to 2018, 2018 to 2019 as well as 2019 to 2020.
Increasing Apprenticeship incentives to £3,000 for all new hires, of any age
Currently, firms in England are given £2,000 for every new Apprentice they take on under the age of 25, and £1,500 for those over 25, in addition to a £1,000 grant they are already getting under another project. The government has now increased the cash incentives for employers who take on an Apprentice to £3,000 – regardless of age.
A new innovative flexi-Apprenticeship programme will allow people to work for a number of different employers in the same sector, a boost for industries with more flexible working patterns such as the media industry.
Restart Grants to help businesses reopen and get going again
Businesses forced to closed during lockdown will be able to claim grants of up to £18,000 to help them reopen.
Non-essential retail businesses will reopen first and will receive grants of up to £6,000. Hospitality and leisure businesses including personal care and gyms, will open later, or be under more restrictions and will therefore receive grants up to £18,000.
Local authorities will receive an additional £425 million of discretionary business grant funding, on top of the £1.6 billion already allocated.
Culture Recovery Fund
The Culture Recovery Fund is to be extended supporting arts, culture and sporting institutions as they reopen. This funding is an extension of the £1.57bn which has to date awarded over £800m grants and loans to over 3,000 cultural organisations in England including theatres, museums, heritage sites, festivals and music venues.
A new Recovery Loans Scheme
As the Bounce Back Loan and CBIL schemes come to an end, a new Recovery Loan Scheme will be introduced to take their place.
Businesses of any size can apply for a loan between £25,000 and £10m until the end of 2021. Loans will have a Government guarantee of 80%. Asset and invoice finance between £1,000 and £10m will also be available. No personal guarantees will be taken on facilities up to £250,000 and, as before, a borrower’s principal private residence cannot be taken as security.
The Recovery Loan Scheme opens April 6th 2021 and will run until December 31st 2021, subject to review. These will be available through a network of accredited lenders. Details on how to apply will be revealed in the coming weeks.
The 100% business rates holiday will continue to the end of June
Businesses including retail, leisure and hospitality in England have been given another three months free of business rates.
The 100% business rates holiday will be extended into the first three months of this financial year, through to the end of June, and for the remaining nine months will be discounted by two-thirds up to a value of £2m, with a lower cap for businesses who have been able to stay open.
You’re eligible if your property is a:
- shop
- restaurant, café, bar or pub
- cinema or live music venue
- assembly or leisure property – for example, a sports club, a gym or a spa
- hospitality property – for example, a hotel, a guest house or self-catering accommodation
5% reduced rate of VAT for hard hit sectors extended for six months
To protect hospitality and tourism jobs, the temporary 5% reduced rate of VAT for the industry will be extended for six months to 30th September. This includes organisations that make supplies of hospitality, hotel and holiday accommodation and admission to certain attractions, and their advisers.
This cut in the VAT rate from the standard rate of 20% will then change to an interim rate of 12.5% from 1st October before returning to the normal rate from April 2022.
In 2023, the rate of corporation tax, paid on company profits, will increase to 25%
In 2023 the rate of corporation tax, paid on company profits, will increase to 25%.
The government are protecting small businesses by creating a Small Profits Rate, maintained at 19% for businesses with profits of £50,000 or less. This means 70% of companies will be completely unaffected.
The government will introduce a taper above £50,000 so businesses only start paying the full rate on profits from £250,000. In total only 10% of companies will pay the full rate.
The Super Deduction
From 1 April 2021 until 31 March 2023, companies investing in qualifying new plant and machinery assets will be able to claim:
- A 130% super-deduction capital allowance on qualifying plant and machinery investments
- A 50% first-year allowance for qualifying special rate assets
The super-deduction will allow companies to cut their tax bill by up to 25p for every £1 they invest.
Liverpool City Region Freeport Approved
Internationally, a Freeport is a place to carry out business, inside a country’s land border but where different custom rules apply. The UK’s bespoke, Flexible Freeports model goes further, combining custom zones with tax reliefs, planning freedoms and support for regeneration and innovation.
The Liverpool City Region Freeport will be a multi-gateway, multi-modal freeport covering 300ha of land across the agreed tax sites of 3MG Widnes, Wirral Waters and Parkside, as well as strategically located customs sites across all modes of transport, linking to the primary customs zone at the Port of Liverpool.
Future Fund: Breakthrough
A new Future Fund Breakthrough to help fill the scale-up funding gap for innovate technology businesses will be introduced.
The £375 million UK-wide ‘Future Fund: Breakthrough’ will invest in highly innovative companies such as those working in life sciences, quantum computing, or clean tech, that are aiming to raise at least £20 million of funding.
Launch of a National Infrastructure Bank
The government has announced plans to launch a new National Infrastructure Bank to finance schemes and play a part in helping the UK reach its net-zero carbon targets.
The new bank, which will be based in Leeds, will be established to boost investment and accelerate progress to net-zero carbon, which the chancellor stated would be a “green industrial revolution”.
The bank will launch with £12bn in capitalisation and aims to attract up to £40bn of private investment into green projects. A green sovereign bond will also be launched as well as a retail investment project, which will allow people to personally invest in green schemes.
Help to Grow scheme for SMEs
Help to Grow will provide access to management training, technology advice and discounted software to improve productivity.
This plan will enable access to some of the UK’s top business schools, while encouraging more companies to adopt technology, in the hope of opening up opportunities to small businesses that larger businesses can normally afford.
The scheme has two streams:
- Digital – digital will be an online service offering free advice on how businesses can improve their digital capability as well as allowing them to get vouchers for 50% off approved software.
- Management – The 12-week Management programme will provide subsidised management training to ‘enhance the skills of leaders’ in areas like financial management and digital adoption. A substantial 30,000 places will be available over three years. The programme is 90% subsidised by government, so participants will have to pay £750.
To get help for your business call us on 01744 742444 or email growthhub@sthelenschamber.com
