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On 3 March, Chancellor Rishi Sunak delivered the 2021 Budget following a prolonged period of economic hardship caused by the Covid-19 pandemic. Here we have provided a summary of the latest measures relating to personal tax.
Universal Credit is a single payment that is made up of different amounts depending on an individual’s circumstances. There is no entitlement if an individual’s capital is worth more than £16,000.
Shortly after the 2020 Budget the Chancellor announced an increase in the Universal Credit standard allowance by £20 per week for one year. The Government is extending the temporary £20 per week increase for a further six months.
The Government is making a one-off payment of £500 to eligible Working Tax Credit claimants to provide extra support over the next six months.
The Government will introduce a new mortgage guarantee scheme in April 2021. This scheme will provide a guarantee to lenders across the UK who offer mortgages to people with a deposit of 5% on homes with a value of up to £600,000.
Under the scheme, all buyers will have the opportunity to ﬁx their initial mortgage interest rate for at least ﬁve years should they wish to. The scheme, which will be available for new mortgages up to 31 December 2022, is designed to increase the availability of mortgages on new or existing properties for those with small deposits.
The Government will offer a green retail savings product through NS&I in the summer of 2021. This product will be closely linked to the UK’s sovereign green bond framework and will give all UK savers the opportunity to take part in the collective effort to tackle climate change. The green gilt framework, to be published in June, will detail the types of expenditure that will be ﬁnanced to meet the government’s green objectives.
The Government will continue to support social enterprises that are seeking growth investment by extending the operation of Social Investment Tax Relief to April 2023. This will continue the availability of income tax relief and capital gains tax hold-over relief for investors in qualifying social enterprises.
The lifetime limit sets the maximum ﬁgure for tax-relieved savings that an individual can build up over their lifetime.
Legislation will be introduced to remove the annual link to the CPI increase for the next ﬁve years. This will maintain the standard Lifetime Allowance at £1,073,100 for tax years 2021/22 to 2025/26.
If you need assistance with effective tax and ﬁnancial planning, we can help to ensure that your ﬁnancial plans remain effective, even as your business and personal circumstances change.
We will work alongside you to help you achieve a rewarding and ﬁnancially secure future. Please contact us to arrange an initial discussion.