Budget 2021: Hidden tax costs for individuals

Despite a vast amount of speculation in the weeks leading up to the Budget on 3 March 2021 the tax measures announced in the chancellor’s speech were scarce particularly those affecting individual taxpayers with details of the government’s plan for the UK’s economic recovery and additional coronavirus support measures taking centre stage.

The main tax headlines featured an increase in the corporation tax rate to 25% from 2023 and a new ‘super-deduction’ for companies investing in new qualifying plant and machinery. There was no mention of any increases to personal taxes in keeping with the Conservative Party’s so-called ‘triple tax lock’ manifesto pledge of not raising income tax National Insurance contributions (NICs) or VAT. However income tax was not left completely untouched as a four-year freeze of both the income tax personal allowance and the higher rate tax threshold were announced. ...