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Budget 2021: Key points at-a-glance

Published 8th March 2021

The UK Chancellor delivered his budget on Wednesday 3rd March 2021 when he announced changes to UK tax. This budget was notable for how little has been changed. The following notes are the highlights we think will interest landlords!

 

Income Tax

The rates of income tax are unchanged. The bands of income to which they apply are slightly increased for 2021-22 reducing (slightly) the tax burden. As predicted the personal allowance has risen from £12,500 to £12,570. The basic rate (20%) band has widened from £37,500 to £37,700. There have been a few very minor changes to other allowances, but the treatment of interest and dividends remains unchanged. See more detail in our web site at landlordstax.co.uk/uk-tax-rates. If you live in Scotland the rates, bands and allowances remain unchanged from 2020-21, and therefore the gap between the burden for Scottish residents and those in the rest of the UK has widened slightly.

 

Corporation Tax

For companies making less than £50,000 taxable profit there are no changes to the rate of tax. With effect from 1st April 2023, companies making more than £50,000 profit will be subject to higher rates of Corporation Tax. The rate will rise progressively until at £250,000 profit the tax rate is 25%. There are other changes to the rules for loss relief.

 

Capital Gains Tax

There are no changes to the rules for UK taxation arising on a disposal of an asset.

 

Stamp Duty Land Tax

On 8th July 2020, the SDLT rates were temporarily reduced until 31st March2021. This has now been extended until 30th June 2021 and then a different but also reduced set of rates will apply until 30th September 2021. See more detail at landlordstax.co.uk/uk-tax-rates.

Purchases of residential property by a non-resident will be subject to a 2% surcharge with effect from 1st April 2021. Purchase of a second or subsequent residential property by both UK residents and non-residents is subject to an uplift of 3% in the SDLT charged.

 

Annual Tax on Enveloped Dwellings (ATED)

The rates have been increased slightly see landlordstax.co.uk/uk-tax-rates.

 

 

This newsletter sets out some of the highlights that we think are relevant to our clients. This is not an exhaustive report on the March 2021 Budget, nor does it address any detail. If one of these subjects is relevant to you or if you want to know about other topics dealt with in the March 2021 Budget then you should contact us for more detail.