How does the Budget announcement affect charities?.

Article | Judith Pederzolli | 8th March 2021

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There was widespread disappointment that there was very little announced specifically for charities in the Budget last week.

Many charities have faced significant financial difficulties at a time when their income has fallen dramatically, so were hoping for some targeted support. A notable omission was any increase in Gift Aid, which many charities had been lobbying for. However, there was positive news:

  • The Job Retention Scheme has been extended until the end of September, albeit with some contributions from employers from July.
  • Some charities may also be able to continue receiving benefit from the temporary reduced rate of VAT for goods and services supplied by the tourism and hospitality sector.
  • Restart grants were announced to support businesses in opening up, but it is not clear whether the State Aid rules still apply, as this could impact on some charities’ ability to claim.
  • Social Investment Tax Relief, which was due to expire this year has been extended until April 2023.
  • 100% business rates relief will be available until 30th June 2021 for retail, hospitality and leisure properties, which may help charities with such properties who do not otherwise qualify for full relief.
  • A further £300m will be provided to the Culture Recovery Fund and £90m for National Museums and cultural bodies in England. The opening date for applications has not yet been confirmed.
  • A £150m Community Ownership Fund was also announced, which is intended to allow communities to continue to benefit from local facilities and amenities. This will open in the summer and community groups will be able to bid for up to £250,000 matched funding to help them buy local assets to run as community-owned businesses.
If you would like to know more about any of the points raised in this article or have another issue you would like to discuss, please contact us or speak to your usual PEM adviser.

About the author

Judith Pederzolli

Judith joined PEM in 2001 and specialises in the property and not for profit sectors. Judith is primarily involved in tax advisory Read more …