UK Spring Budget 2021

In the UK Spring Budget on 3 March 2021, the UK Chancellor Rishi Sunak set out the Government's plans for taxation and spending for the upcoming financial year. The plans focused on protecting jobs, fixing the public finances and building the future economy.

With further consultations and policy changes to potentially follow on 23 March, there were fewer announcements today than we are used to, but there were still a number of developments of note.

The most significant for businesses were the announcements that:

• the main rate of corporation tax would increase to 25% (from the current rate of 19%) in April 2023;
• trading losses incurred in accounting periods ending in the period between 1 April 2020 and 31 March 2022 can temporarily be carried back for three years, rather than one year, subject to a cap; and
• from 1 April 2021 to 31 March 2023, companies investing in new plant and machinery will be able to claim a 130% super-deduction for expenditure on most new plant and machinery that would ordinarily qualify for 18% capital allowances and a 50% first-year allowance for most new plant and machinery that would ordinarily qualify for 6% capital allowances.

For more information, please see our summaries below.