Recovery was the theme of Chancellor Rishi Sunak’s speech on Wednesday 3 March, as he set out a three-part plan to support the economy and start repairing the damage done to public finances throughout the pandemic.
While there was some speculation beforehand that Sunak would use this Budget to start covering the cost of COVID-19 support measures, his focus still seemed to be on spending for the most part.
The cost-covering measures that were announced were limited, with income tax thresholds frozen, and plans set out to raise the main rate of corporation tax to 25% but spare smaller businesses the extra cost by introducing a small profits rate.
You can read more about the measures announced in our full Budget report – or read on for our summary of what it means for our clients in the creative and property industries.
The creative industries have been among the most severely affected by the COVID-19 pandemic, with theatres and arts venues forced to shut, and social distancing making it harder to work collaboratively.
Many creative freelancers have also lost work as their clients cut back on their budgets in response to financial pressures.
For those self-employed workers, the extension of the self-employment income support scheme was expected but welcome, with a fourth grant covering the period from February to April, and a fifth from May to September.
The fourth grant will continue to offer 80% of three months’ average trading profits, up to a cap of £7,500, but the fifth will only offer this full grant to businesses that meet a turnover test.
If you’re an employer, you’ll be able to use the furlough scheme to cover the costs of staff wages. This has also been extended to the end of September.
The Budget also included an extra £300 million in funding for the Culture Recovery Fund, which was launched last year and offers grants worth between £50,000 and £3 million to cultural organisations.
The Film and TV Production Restart Scheme, which compensates coronavirus-related losses for film and TV productions, has also been extended for an additional six months, to 31 December 2021.
And a £7 million fund was announced for “portable apprenticeships” in England, which will allow apprentices to work across multiple projects with different employers.
The Government says it will ask the Creative Industries Council in particular to bring forward proposals on this, “in recognition of the potential benefits of this new approach for the creative sector”.
For those who do decide to take on apprentices, the incentive payment will double between 1 April 2021 and 30 September 2021, from £1,500 to £3,000.
Most property-related announcements in the Budget were aimed at maintaining momentum in the housing market and supporting homebuyers who have been struggling during the pandemic.
This included extending the current stamp duty holiday for properties in England and Northern Ireland with a value under £500,000. This was set to come to an end on 31 March 2021, but was extended for three months to the end of June.
A staggered decrease to the threshold will kick in after that, going down to £250,000 until 30 September, then returning to its previous level of £125,000 from 1 October onwards.
In addition, Sunak confirmed a new Government guarantee for lenders who provide mortgages to buyers with 5% deposits, on houses with a value up to £600,000. This will be available from April 2021 to 31 December 2022.
These announcements seem to have already started boosting activity in the housing market, with property website Rightmove reporting its “busiest day ever” on 3 March.
“It’s clear from our record-breaking traffic numbers that the Spring Budget has introduced buyers into the market who were not perhaps able to consider moving until now or who were waiting to hear what was going to happen to stamp duty,” said Tim Bannister, director of property data at Rightmove.
“Many people who may have been delaying a move for a whole multitude of reasons now have the impetus and encouragement to take their next life step – whether it’s getting a foot on the property ladder as a first-time buyer or trading up for more space and a bigger garden.”