Draft agreements have been published which, if ratified, should allow for a continued free flow...
Budget 2021 - HR summary
The inevitable headline of the March 2021 Budget is the extension of the furlough scheme but there are other matters of note for HR.
- The Coronavirus Job Retention Scheme (furlough) will remain in place until 30 September 2021. Furloughed employees will continue to receive 80% of their salary for hours not worked, up to £2,500 a month, but employers will have to contribute 10% from July and 20% in August and September towards the hours their staff do not work, as well as employer NICs and pension contributions. See here for more details.
- No changes to rates of income tax or NICs. However personal income tax allowance to be frozen at £12,570 from 2022-26. Higher rate income tax threshold to be frozen at £50,270 from 2022-26.
- Two new ‘Help to grow’ schemes, including a management training scheme for SMEs, of which 90% of the cost will be covered by the government; and a digital scheme that will give small businesses access to free expert training and a 50% discount on productivity enhancing software.
- The income tax exemption and NICs disregard for COVID-19 antigen tests provided by, or reimbursed by, employers and for employer reimbursed expenses covering the cost of home office equipment, will be extended to the 2021-22 tax year.
- Apprentices - employers who hire a new apprentice between 1 April 2021 and 30 September 2021 will receive £3,000 per new hire, compared with £1,500 per new apprentice hire (or £2,000 for those aged 24 and under) under the previous scheme. A new £7m fund will be set up from July 2021 to help employers in England set up and expand portable apprenticeships.
- SSP – the scheme by which SMEs can reclaim up to two weeks of eligible SSP costs per employee will be continued.
- Fraud – a new taskforce with over 1,000 HMRC staff will target fraud in the use of support packages such as furlough (an abuse first highlighted by us in June 2020). All employers who have used the furlough scheme should make sure that they have kept proper records throughout the scheme and are ready to answer HMRC questions if needed.
- Immigration - changes to the immigration system to help the UK attract and retain the most highly skilled, globally mobile talent were also announced. Our friends at Migrate UK have helpfully summarised these here.