Key points from the Spring Budget

7th April 2020

THE ECONOMY

  • Economy predicted to grow by 1.1% in 2020-21, revised down from 1.4% forecast a year ago (this figure does not take into account the impact of COVID-19)
  • Growth predicted to rebound to 1.8% in 2021-22, easing back to 1.5% in 2022-23
  • Inflation forecast of 1.4% this year, increasing to 1.8% in 2021-2022

PUBLIC SERVICES AND CORONAVIRUS

  • £5bn emergency response fund to support the NHS and other public services in England
  • All those advised to self-isolate will be entitled to Statutory Sick Pay, even if they have not presented with symptoms
  • Self-employed workers who are not eligible will be able to claim contributory Employment and Support Allowance (available from day one)
  • £500m hardship fund for councils in England to help the most vulnerable in their areas
  • Firms with fewer than 250 staff will be refunded for sick pay payments for two weeks
  • Small firms will be able to access business interruption loans
  • Business rates in England will be suspended for firms in the retail, leisure and hospitality sectors with a rateable value below £51,000
  • £6bn in extra NHS funding over five years to pay for staff recruitment and start of hospital upgrades

PERSONAL TAXATION, WAGES AND PENSIONS

  • The tax threshold for National Insurance Contributions will rise to £9,500 (previously announced)
  • Tax paid on the pensions of high earners, including NHS consultants, to be recalculated to address staffing issues
  • The two tapered Annual Allowance thresholds for pensions will each be raised by £90,000
  • The minimum level to which the Annual Allowance can taper down will reduce from £10,000 to £4,000 from April 2020
  • Annual Capital Gains Tax exemption increased to £12,300 from 2020-21
  • ISA allowance to remain at £20,000 for 2020-21 tax year / JISA allowance increase to £9,000 for 2020-21 tax year
  • The Lifetime Allowance for pensions will increase in line with the Consumer Prices Index, to £1,073,100 for 2020-21
  • From 11 March 2020 the Lifetime Allowance on gains eligible for Entrepreneurs’ Relief reduced from £10m to £1m
  • The new single-tier State Pension will increase to £175.20 per week in April 2020, pensioners receiving the older basic State Pension will see it increase to £134.25 per week.