The Chancellor Rishi Sunak presented his first Budget on Wednesday 11 March 2020. In his speech he stated ‘we are at the beginning of a new era in this country. We have the freedom and the resources to decide our own future’.

Our summary focuses on the tax measures which may affect you, your family and your business. To help you decipher what was said we have included our own comments. If you have any questions please contact us for advice.

Our full report on the Spring Budget can be found here.

With the end of the tax year looming there is still time to save tax for 2019/20.

• Make full use of your ISA allowance – ISAs can offer a useful tax free way to save, whether this is for your children’s future, a first home or another purpose. Individuals may invest up to a limit of £20,000 for the 2019/20 tax year. Savers have until 5 April 2020 to make their 2019/20 ISA investment.

• Pensions provide significant planning opportunities. The annual allowance (AA) which is the maximum you can contribute to a pension and still get tax relief, is generally £40,000. Exceeding this can result in an AA clawback charge. However, in many circumstances individuals may have unused AA from the three previous tax years which can be used in 2019/20, providing the means of making a significant contribution without incurring a charge. Please contact us for advice specific to your circumstances.

These are only two suggestions that you may wish to consider as part of your tax planning strategy. Contact us for more information.

Internet links: GOV.UK ISAs Pensions Advisory Service AA

The government has launched a consultation on proposals to create up to ten freeports across the UK which would have different customs rules than those which apply in the rest of the UK.

The government is considering a UK freeport model which would include multiple customs zones located within or away from a port, as well as a type of special economic zone (SEZ) designated over or around the customs zones and intends to work with the devolved administrations to develop proposals to allow freeports to be created in Scotland, Wales and Northern Ireland, in addition to those in England.

The proposals include the following customs and tariff benefits for businesses bringing goods into a freeport site:

• duty suspension, with no tariffs, import VAT or excise to be paid on goods brought into a freeport from overseas until they leave the freeport and enter the UK’s domestic market
• duty inversion if the duty on a finished product is lower than that on the component parts, allowing businesses to benefit by importing components duty free, manufacture the final product in the freeport, and then pay the duty at the rate of the finished product when it enters the UK’s domestic market
• duty exemption for re-exports allowing businesses to import components duty free, manufacture the final product in the freeport and pay no tariffs when the final product is re-exported
• simplified customs procedures for businesses accessing freeports.

Freeports are secure customs zones located at ports where business can be carried out inside a country’s land border but where different customs rules apply. Typically, goods brought into a freeport do not attract a requirement to pay duties until they leave the freeport and enter the domestic market. No duty is payable at all if the goods are re-exported.

Internet link: GOV.UK consultation

The government has pledged thousands of pounds in additional financial support for victims of the recent floods.

The Government has announced that businesses in England affected by the floods will be eligible for 100% business rates relief for at least three months. It also stated that small and medium-sized enterprises (SMEs) that have experienced severe, uninsurable losses will be able to claim up to £2,500 from the Business Recovery Grant.

The government also announced that businesses affected by flooding will be able to apply for up to £5,000 to help make them more resilient to future flooding.

Commenting on the funding, Robert Jenrick, Secretary of State for Housing, Communities and Local Government, said:

‘Storm Dennis and Ciara have severely impacted a large number of households and businesses, and I recognise how destabilising this can be.

‘This extra support, including new funding, will help people in the worst hit areas to recover and get back on their feet as soon as possible.’

The announcement only applies to businesses in England. Flooding is a devolved issue for Wales, Scotland and Northern Ireland.

Internet link: GOV.UK news