The 2021 Budget announcement set out the Government’s spending and taxation plans for the next financial year. So what are the implications commercial and investment property?
In a boost for both homebuyers and buy-to-let investors, the SDLT holiday has been extended up to the end of June 2021 so that no SDLT will be paid on the first £500,000 of the purchase of price of residential property. This will reduce to apply to only the first £250,000 of the purchase price from the 1st July until the end of September and will then return to the pre-Covid-19 position from 1 October with no SDLT payable on the first £125,000. Investors should note however that the 2% non-residential SDLT surcharge is to apply on April 2021 to purchases of a second home or on a buy to let basis.
The Chancellor has confirmed that the current business rates holiday will be extended from the end of March until the end of June 2021. From 1 July, there will still be a further discount of two thirds business rates liability, capped at £2,000,000 per business for properties which were required to be closed on the 5 January 2021 and capped at £105,000 on other eligible properties, to apply for the rest of the year.
Restart grants of £6,000 are to be available for premises used for non-essential retail business and grants of £18,000 will be available for premises used for hospitality, accommodation, leisure, personal care and gym businesses. The Government has also allocated councils additional discretionary business grant funding of £425 million.
To incentivise investment in plant and machinery, businesses are able to use capital allowances to write off the costs of capital assets against taxable income. The “superdeduction” announced in the 2021 Budget is an enhanced first year allowance which provides for an allowance exceeding the costs of the assets. Specifically:-
Under the Coronavirus Act 2020, landlords were barred from issuing court proceedings to evict tenants from commercial properties for non-payment of rent. The Government’s timetable was for this moratorium to end at the end of March. The 2021 Budget was silent on this but the Government have now announced that the moratorium has now been extended to 30 June. Please look our for more analysis of this on our website.
If you would like to discuss any of the matters raised in this article further or require any additional information, please contact Dominic Dos Remedios