The furlough scheme ended on 30 September 2021 and several other temporary coronavirus measures, including for stamp duty land tax (SDLT), came to an end at the same time. The following are the most recent tax changes:
Watershed. 30 September 2021 marked an end for businesses being able to claim for staff on furlough. However, the date is also crucial for other reasons.
Property. Firstly, the extended stamp duty land tax (SDLT) holiday for transactions in England and NI came to an end. The 0% band was temporarily set at £250,000, but now reverts to the standard £125,000. Relief is available for first-time buyers.
VAT. The VAT rate for the hospitality industry has also increased. In July 2020 the government slashed the applicable rate from 20% to 5%. From 1 October 2021 the rate increases to 12.5%.
Pro advice. This is a completely new VAT rate, so we’d like to ensure clients are capable of processing transactions correctly, e.g. by reprogramming tills etc.
FRS. Certain flat rate scheme (FRS) percentages were also cut in July 2020. From 1 October 2021 these have increased – though not to their pre-pandemic levels. The affected categories are as follows (previous rates shown in brackets):
- hotels and other accommodation businesses – 5.5% (0%)
- pubs – 4% (1%)
- catering businesses – 8.5% (4.5%).
Pro advice: “We warn that a further increase is scheduled for 1 April 2022 when the rates will return to their pre-pandemic levels of 10.5%, 6.5% and 12.5% respectively”.
Pro advice: Where your business does not submit VAT returns for calendar quarters there will be two FRS rates to deal with for periods ending in October or November.
Kim Redwood-Lee says “The SDLT holiday has ended and VAT rates – including flat rate scheme percentages – have increased for the hospitality industry. Further increases are coming in April 2022, and we urge our clients to get in touch for advice on how to deal with the new rates”.
About Oscar Fairchild: Oscar Fairchild (incorporating Redwood Clarke since 01.09.18) is an ACCA chartered and certified and AAT qualified accountancy, financial consultancy & bookkeeping practice with offices in The City of London, and Billericay, Essex. Offering a wide range of services including Self-Assessment Services, Annual Returns, VAT Returns, Credit Control, Payroll, Auto Enrolment Pension and Management Account services to high growth businesses and licensed London taxi drivers across London, Essex and Hertfordshire.