A Budget Day… at last

In early January Chancellor announced a new Budget date: 11 March 2020.

This could be a significant Budget. Traditionally, the first Budget of a new Parliament is when the Chancellor delivers the medicine of tax increases and/or unpopular reforms. To borrow from Macbeth: ‘If it were done when ‘tis done, then ‘twere well it were done quickly’…that way the electorate has over four years to forget.

If you’re struggling to remember what happened in Budget 2019, you haven’t forgotten. Unusually, in 2019 there was no Budget. There was a Spring Statement in March 2019 from Philip Hammond, but the general election call forced his successor, Sajid Javid, to abandon the planned Autumn Budget set for 6 November. During the election campaign, the Conservative party said that the Budget would be revealed in February, but this date shifted again in the new year when the Chancellor announced a date of 11 March.

On the 13th March Bluecoat Wealth Management Ltd will be presenting our Post Brexit Budget Brief at our main office in Southwick, where we will break down and analysing the budget. Please follow this link to register for the event https://www.eventbrite.com/e/post-brexit-budget-briefing-tickets-91150015149

We already know a good proportion of what the Chancellor will announce, as draft legislation was published eight months ago in anticipation of the cancelled Autumn 2019 Budget. The contents will almost certainly include controversial legislation to strengthen the operation of off-payroll working rules (IR35) in the private sector, possibly with some amendments following the government’s last minute review, as well as tighter rules on the capital gains tax treatment of main residences. Both are due to take- effect from 6 April 2020.

Ahead of the Budget, the government confirmed at the end of January a ‘tax cut’ mentioned in the Conservative party manifesto, of an increase in the starting point for national insurance contributions (NICs) from the current £8,632 to £9,500 a year – a maximum saving of £2 a week.

The Budget unknowns include what the Chancellor might do about pensions tax relief. He already faces a growing problem with the impact of the annual allowance on NHS senior staff, which has been fixed temporarily, but only until April. There are already calls for the Chancellor to overhaul the system, something he could do while simultaneously raising more revenue.

One consequence of the Budget date is that any year-end tax planning – especially on the pension front – now potentially has a deadline date of 10 March.

Articles on this website are offered only for general informational and educational purposes. They are not offered as and do not constitute financial advice. You should not act or rely on any information contained in this website without first seeking advice from a professional. Past performance is not a guide to future performance and may not be repeated. Capital is at risk; investments and the income from them can fall as well as rise.