Budget 2021: Response For Recruitment Industry
Well, I have never experienced a budget where there were so many leaks before the actual event that it was pretty much an anti-climax, however, there were a few big announcements that need to be mentioned that will affect the recruitment sector. I also think it was a budget for “not containing expected changes” to capital gains tax rates, pension rates for higher rate taxpayers and for once landlords have been left alone as I don’t think they could have taken any more tax hikes.
Anyway, see below details of the major changes you should be aware of and as always, the detail will be in small print:
Corporation Tax
This will return to a two-tiered system from April 2023 when:
- the rate of corporation tax will rise to 25% for companies with profits exceeding £250,000
- companies with profits up to £50,000 will continue to pay 19%
- companies with profits between £50,001 and £250,000 will pay tax at 25% reduced by marginal rate relief rate so that the main rate won’t apply until their profits excess the higher amount
Coronavirus Job Retention Scheme
This is now extended to the end of September 2021 so will help those recruitment companies who want to gradually bring their staff back to work. However, employers will need to start to contribute towards the cost from July onwards.
New Recovery Loan Scheme
This will help those recruitment companies that have struggled to obtain a CBILS or Bounce Back Loan as the Government will guarantee 80% of the loans which can be taken out between £25,000 and £10m.
Apprenticeship Incentives
Now might be the right time to bring in apprentices into your recruitment business as the hiring incentive has been extended to September 2021 with an increased payment of £3,000. A new “flexi-job” apprenticeship programme has also been announced which will enable apprentices to work with employers in the recruitment sector.
Super Deduction for investment in plant and machinery
This will help those recruitment companies looking to invest in new tech to help them remain competitive and efficient as there will be a super deduction of 130% on the cost of new assets purchased from April 2021.
At least when the pubs re-open alcohol duties have been frozen again for the second year running saving drinkers £1.7bn so we can all fill our boots and get completely pissed!!
Finally, if you really have had enough of working in the recruitment sector you could always look to go into a new market a maybe obtain part of the £68m to fund a UK-wide competition to deliver first-of-a-kind long-duration energy storage prototypes that will reduce the cost of net zero by storing excess low carbon energy over longer periods!!
If you have any further questions, please don’t hesitate to get in touch.