CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 66% of retail investor accounts lose money when trading CFDs with this provider (Saxo Bank). You should consider whether you understand how CFDs, FX or any of our other products work and whether you can afford to take the high risk of losing your money.

UK Budget 2021

Chancellor extends furlough but lifts corporation tax

Chancellor Rishi Sunak has taken decisive action in today’s Budget to address the costs of the C-19 pandemic.

*The UK government will extend the furlough program to 30th September 2021 however the contribution paid by employers will be 10% in July and 20% in both August and September. (There were c. 4.7m people on the furlough scheme as at 25th February 2021)

*Support for the UK’s self employed will be extended to 30th September 2021 but 600k more self-employed will have access to grants

*£20 per week uplift in Universal Credit to be extended for six months with working tax credit claimants to get £500 one-off payment

*Minimum wage to rise to £8.91 in April 2021

*C-19 business rates holiday to continue until June 2021 with 75% discount afterwards

The Chancellor pointed out the UK GDP contracted by 9.9% in 2020 and will only return to 2019 levels in 2022 assuming 4% growth in 2021 and 7.3% in 2022.

*The PSBR is expected to be a record £355bn in 2021 and £234bn in 2022.

*UK unemployment expected to rise to 6.5% in 2022

*At least 700k have lost their jobs since March 2020

The Chancellor has re-introduced the pre-2017 tiered system of corporation tax.

*”Smaller companies” (those with profits<£50,000) will keep paying 19% CT however this will rise to 25% by April 2023 for companies not in this band.

*No changes to income tax, NI, VAT or inheritance tax however the personal income tax allowance is to be frozen at £12570 from April 2022 to 2026 and the higher rate threshold is to be frozen at £50,270 for the same period.

*Stamp duty holiday to remain in place until end June 2021. Contactless payments to increase to £100 from £45.

Other items:-

*£1.65bn for the UK vaccination rollout programme ( drug / staff provision etc)

*A new UK Infrastructure Bank will be set up with £12bn of starting capital and be based in Leeds.

*The UK government will issue £15bn in ‘green bonds’ to help finance the transition to net carbon zero by 2050.

*Tax breaks will enable firms to deduct “investment costs” from tax bills reducing taxable profits by up to 130%

*Alcohol and fuel duties frozen



The Budget was reasonably well flagged with investors expecting the furlough program to be extended. The extension to 30th September 2021 allows sufficient time for the C-19 vaccination program to reach the UK adult population.

The rise in corporation tax is a future tax the timing of which will allow the corporate sector to fully recover previous profitability.

The Chancellor pointed out that repairing the long term damage will take time and the UK economic contraction is the largest in 300 years. He also sounded downbeat about international prospects noting the global economic recovery will also take time. Importantly the Chancellor has dampened the notion of a quick recovery with a 4% GDP jump in 2021 just above half of previous expectations.

Overall this Budget was soft with continued assistance for those on furlough. This is only fair, the government mandated lockdowns/ closures so must provide for people not able to work. The measures are aimed at preventing a massive surge in unemployment as the economy re-opens over April and May 2020. This should benefit the banking sector, keeping actual losses down and essential consumer goods/ food retailers etc.


Subscribe to our Award-winning Newsletter

We provide daily market data in the form of our award-winning newsletter, The Morning Call and The Market Close.
You can subscribe to this information at any time to help you make the most of your investment.

Quick Sign-up

Important Information

Key to Material Interests:

Please be aware that the following disclosures of Material Interests are relevant to this research note:

Company NameRelevant disclosures: (2)

  1. The analyst has a personal holding in the securities issued by the company or of derivatives linked to the price of the company’s securities.
  2. Collins Sarri Statham Investments Ltd has clients who hold either shares or CFD positions in this security.

Analyst Certification:

The report’s author certifies that this research report accurately states his personal views about the subject securities, which is reflected in the ratings as well as the substance of the reports.


Collins Sarri Statham Investments Ltd (CSS) does not in any of its publications take into account any particular recipient's investment objectives, financial situation, and specific needs and demands. Therefore, all CSS publications are, unless otherwise specifically stated, intended for informational and/or marketing purposes only.CSS shall not be responsible for any loss arising from any investment based on a perceived recommendation.

No publication (including recommendations) shall be construed as a representation or warranty that the recipient will profit, nor avoid sustaining losses, from trading in accordance with a trading strategy set forth in a publication.

This research is non-independent and is classified as a Marketing Communication under FCA rules detailed in their Conduct of Business Rulebook (COBS). As such it has not been prepared in accordance with legal requirements designed to promote independence of investment research and it is not subject to the prohibition of dealing ahead of the dissemination of investment research outlined in COBS 12.2.18.

Risk Warning:

Trading in the products and services offered by Collins Sarri Statham Investments Ltd (CSS) may, result in losses as well as profits as the value of investments may go down as well as up. You may not get back the full amount you have invested. Any reference to past performance should not be viewed as an indication of any future performance. Investments held in overseas markets are subject to the effects of changes in exchange rates which will impact on the value of the underlying investment. Investments made in AIM and penny shares carry an increased risk due to the difficulty in creating a market in these shares. There may be a substantial difference in the buy and sell price. Leveraged products such as Contracts for Difference (CFDs), derivatives, commodities & Foreign Exchange (FX), carry a higher risk to your capital and they can lose their value rapidly.

Speculative Trading is not Suitable for all Investors

The information contained herein is based on materials and sources that we believe to be reliable however we make no representation or warranty, either express or implied, in relation to the accuracy, completeness or reliability of the information contained herein. Please note that the figures shown may, in some instances, be rounded to the nearest penny. Prices can move sharply from those quoted in this document. Current prices can be verified by calling one of our brokers. CSS is under no obligation to update the information contained herein. Neither CSS, nor its affiliates, nor its employees shall have any liability whatsoever for any indirect or consequential loss or damage arising from the use of this document.

Get Started with CSS

Open an Account

Subscribe to our award winning daily newsletter

Voted "Best Market Newsletter" in 2012, 2014, 2015 and 2017 by the City of London Wealth Management Awards

Subscribe to our newsletter (Popup)

By signing up to our free email, you are consenting to receive these promotions. The newsletter is sent up to three times per day during the week and up to once per day over the weekend and is directed at UK residents. The newsletter contains company news, market movements, CSS research and promotions and breaking economic news. Occasionally our newsletter will contain advertisements from trusted partners. However, we will never give, sell or rent your email address to any other companies. If you want to stop receiving our free emails you can unsubscribe at any time by clicking on the link at the bottom of each email. You can read our privacy policy here.

No, thank you I am already subscribed