The Finance Bill 2021 has now been published

11 March 2021

The Finance Bill 2021 has been published today, 11 March, which legislates the tax changes announced within the Budget.

The Bill will ensure that several tax changes set out by the Chancellor at last week’s Budget will take effect from the start of the next tax, 6 April 2021.

The Bill includes:

  • The extension of the stamp duty holiday
  • Extending the VAT cut for tourism and hospitality to September 2021
  • Increasing the rate of Corporation Tax to 25% on profits over £250,000 from April 2023. It is estimated that over 90% of businesses will pay less than the 25%.
  • Maintaining Income Tax Personal Allowance and Higher Rate Threshold at 2021 levels
  • Keeping the Capital Gains Tax Annual Exempt Amount (AEA), the inheritance tax nil-rate band and the pensions Lifetime Allowance at their current levels
  • The ‘super deduction’ which will run from 1 April 2021 until 31 March 2023
  • Supporting the introduction of Freeports through allowing the government to designate ‘tax sites’ in Freeports in Great Britain, where businesses will be able to benefit from a number of tax reliefs
  • Changes to the off-payroll working rules

The Bill also supports to deliver a fairer and more sustainable tax system as well through legislating to:

  • Implement a Plastic Packaging Tax which encourages the use of recycled plastic instead of new plastic within packaging. The rate of the tax is £200 per tonne of plastic packaging which contains less than 30% recycled plastic content.
  • Reform the penalty regime for VAT and Income Tax Self-Assessment (ITSA) to make it fairer and more consistent. The Bill helps drive an investment-led recovery through:

The Bill will now follow the normal passage through parliament.

The full contents of the 2021 Finance Bill can be found here.

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