Spring 2021 UK Budget Summary
Listed Under: News
Chancellor Rishi Sunak has unveiled the details of his Budget in the House of Commons and here are some key points.
What you need to know:
- The personal allowance (the amount you earn before you start paying income tax) will rise to £12,570 from April 2021, previously £12,500 and will remain at this level until April 2026. In addition, the higher rate threshold will also be increased to £50,270 and frozen until 2026.
- The rate of corporation tax will increase from April 2023 to 25% on profits over £250,000. The rate for profits under £50,000 will remain at 19%. A tapered rate will be introduced for profits above £50,000.
- Mortgage guarantee scheme - will be introduced in April 2021. Lenders who provide mortgages to homebuyers who can only afford a 5% deposit on homes with a value up to £600,00 will benefit from a government guarantee on those mortgages.
What has remained unchanged:
- The annual exempt amount of Capital Gains remains unchanged at £12,300 for individuals, personal representatives and some types of trusts and £6,150 for most trusts. This will remain unchanged until April 2026.
- The ISA allowance will remain at £20,000 and £9,000 for the Junior ISA for 2021/2022 tax year.
- The lifetime allowance will be maintained at the current level of £1,073,100 until April 2026.
- The Inheritance tax bands will remain the same until April 2026. The nil-rate band will continue at £325,000; the residence nil-rate band will continue at £175,000 and the residence nil-rate band taper will continue to start at £2 million.