Three things from the 2021 Budget that could benefit Self-Catering businesses in the UK
The Chancellor, Rishi Sunak, outlined his tax and spend policies in the Budget. Below is a summary of the budget for the tourism and hospitality industry. You can read what you need to know page summary here or view the budget document here. Highlights include: • VAT reduction for the UK’s tourism and hospitality sector - The temporary reduced rate of 5% VAT for hospitality businesses has been extended until the end of September. From October to 31 March 2022 the rate will revert to an ‘interim’ level of 12.5%. There is no change to the scope of the VAT reduction.
- Business rates reliefs – There will be a three-month 100% business rates holiday until 30 June 2021. For the remaining three quarters there will be a two-thirds relief (66%) BUT the value of the relief on these nine months (1 July 2021 to 31 March 2022) will be capped at £2 million. Any business that has a rates bill over £4m will therefore be subject to a cap on their relief.
- UK Self-Employment Income Support Scheme (SEISS) Fourth and fifth grant rounds are confirmed - SEISS fourth grant – the fourth SEISS grant will be worth 80% of three months’ average trading profits, paid out in a single instalment and capped at £7,500 in total. The grant will cover the period February to April and can be claimed from late April. Self-employed individuals must have filed a 2019- 20 Self Assessment tax return to be eligible for the fourth grant.
- SEISS fifth grant – there will be a fifth and final SEISS grant covering May to September. The value of the grant will be determined by a turnover test. People whose turnover has fallen by 30% or more will continue to receive the full grant worth 80% of three months’ average trading profits, capped at £7,500. People whose turnover has fallen by less than 30% will receive a 30% grant, capped at £2,850. The final grant can be claimed from late July
With thanks to Visit Exmoor for this information.