The Chancellor previously commented that given the level of support provided to the self-employed during the pandemic, it was harder to justify the inconsistencies in national insurance contributions between people of differing employment statuses. This resulted in speculation of a possible alignment of national insurance rates paid by employed and self-employed individuals. If introduced, this could have represented a significant cost to self-employed individuals of professional practices in an LLP or partnership. National insurance rates, however, remain unchanged, along with rates of income tax and capital gains tax. There has been a small increase in the higher rate threshold for income tax and Class 4 NIC, together with a similar increase in the personal allowance for 2021/22. These thresholds will then be frozen until 2025/26, which will effectively increase the tax burden on many individuals over time.

The Budget has focussed on investment in infrastructure as a way to bolster the UK economy. the further support for the real estate industry as a whole is very welcome. There are extensions to both the Stamp Duty Land Tax (SDLT) and business rates holidays along with significant tax reliefs available to those businesses investing in the new Freeports of the UK over the next 5 years.

The increase in the corporation tax rate to 25% was the headline grabbing announcement and consistent with the Chancellor’s warnings that the pandemic support measures needed to be funded. The increase is expected to raise £17 billion in 2025/2026, although this also accounts for ‘behavioural changes’ as a result of various incentives according to the Government’s policy paper.

There were a number of changes announced for businesses in this Budget. For the Financial Services sector this Budget provided several new growth initiatives to encourage investment into the UK.