COVID-19 Support for Businesses
COVID-19 support has continued in the Chancellor budget, such as extending the furlough scheme (CJRS) to 30 September 2021.
Sole-traders will claim a fourth SEISS grant from late April and a fifth SEISS grant in late July 2021.
A new Recovery Loan Scheme will replace existing government guaranteed schemes, including CBILS and BBLS, which closes at the end of March.
There will be a three-month extension to the stamp duty land tax holiday until 30 June 2020.
Business rates holiday was extended in the Budget announcements – but only until June, when a transitional 66% relief will occur.
Increase to National Living Wage
As already confirmed, from 6th April 2021, the NLW will increase to £9.24 from £8.72.
Small firms digital transformation support
A new one-off £5,000 vouchers to help 100,000 businesses train up and invest in “productivity-enhancing software.” However, with MTD for income tax rising in April 2023, the scheme stops short of helping the smallest businesses to go digital by restricting the vouchers to UK companies and LLPs that employ between 5 and 249 employees.
Optimum Directors Salary 2021/22
When it comes to tax-efficient salary levels for April 2022 there are three national insurance thresholds you need to be aware of:
Lower Earnings Limit – as long as you pay a salary above this, you are protecting your entitlement to future state pension and benefits without paying any national insurance. For April 2022 this is £520 per month, £6,240 for the year
Primary Threshold – if you earn above this, you personally have to start paying national insurance – for April 2022 this is £797 per month, £9,568 for the year
Secondary Threshold – if you earn above this your business has to start paying national insurance – for April 2022 this is £736 per month, £8,840 for the year
Corporation tax will rise in 2023 to 25%, but the good news is that small businesses with trading profits of under £50,000 will continue to be taxed at 19%. A further increased rate will be introduced for profits above £50,000 will be taxed at the full 25%.