Author: Ketan Umretiya

Scotland’s Finance Secretary, Kate Forbes, has announced that the Scottish Government’s Budget will be published for 2021-22 on 28 January 2021. The date has been selected in order to allow the Scottish Government time to prepare for the new tax year.

This is the second time that Scotland has held a Budget before the rest of the UK. The announcement follows the UK Government’s decision to postpone its Autumn Budget until an unspecified date in the new year.

The Finance Secretary commented that:

‘Coming amidst an unprecedented global pandemic, the forthcoming Scottish Budget will be one of the most important since devolution.

It is my task to prioritise our resources as effectively as possible to drive the country’s economic recovery from coronavirus (COVID-19) while also managing the ongoing impact of the virus.

The Chancellor’s decision to delay the UK Autumn Budget until next year causes significant difficulties for the Scottish Budget process. Although we expect to receive some funding information from the UK Spending Review on 25 November, the absence of a UK Autumn Budget means we will have to make decisions based on partial and provisional information, with no indication of potential changes to UK tax policies.

In these circumstances, and to allow us to take account of the emerging position on any EU exit deal and also the evolving situation with COVID-19, I believe it is necessary to publish the Scottish Budget 2021-22 in early 2021, rather than later this year.’

The Scottish Parliament sets the Income Tax rates and bands for non-savings and non-dividend income in Scotland. Scottish taxpayers therefore pay Income Tax at separate rates and bands to the rest of the UK on their non-savings and non-dividend income.

The government guidance for landlords and tenants as a result of the coronavirus pandemic has been updated. The Coronavirus Act 2020 provides protection to social and private tenants by delaying when landlords can start proceedings to evict tenants. 

To give tenants greater protection from eviction, landlords are required to provide tenants with 6 months’ notice period before they can start possession proceedings. This applies except in cases raising other serious issues such as those involving anti-social behaviour, domestic abuse, false statement and where a tenant has accrued rent arrears in excess of 6 months’ rent.

The stay on possession proceedings expired on 20 September 2020 and landlords can now progress their possession claim through the courts. The most egregious cases will be prioritised by the courts ensuring landlords are able to progress the most serious cases.

To protect against coronavirus transmission, bailiffs have been asked not to enforce evictions during the national restrictions in England except in the most serious circumstances. Together with pause on enforcement of evictions starting in December that has been agreed with bailiffs, this means that evictions in England will not be enforced until 11 January at the earliest, except in the most serious circumstances. 

Landlords can continue to carry out repairs and safety inspections during the English lockdown period provided this is done in line with public health advice.

The guidance is clear that tenants should continue to pay rent and abide by all other terms of their tenancy agreement to the best of their ability. Tenants who are unable to do so should speak to their landlord at the earliest opportunity.

The Financial Conduct Authority (FCA) has announced new proposals to ensure that lenders provide tailored support to mortgage borrowers who continue to face payment difficulties due to the COVID-19 crisis. This follows the additional government measures announced over recent weeks to control the spread of coronavirus.

Payment holidays to support mortgage borrowers who are experiencing payment difficulties because of coronavirus will be extended. These measures were due to come to an end on 31 October 2020.

This means that:

• those who have not yet had a payment deferral will be eligible for 2 payment deferrals of up to 6 months in total
• those who currently have an initial payment deferral, will be eligible for another payment deferral of up to 3 months 
• those who have resumed repayments after an initial payment deferral will be eligible for another payment deferral of up to 3 months 

Under the FCA’s proposals, borrowers would have until 31 January 2021 to request a payment deferral. A payment deferral under these proposals would not be reported as missed payments on a borrower’s credit file.

The FCA is also proposing that no one will have their home repossessed without their agreement until after 31 January 2021.

Some borrowers would not be eligible for a payment deferral because they may already have had 2 payment deferrals (of up to 6 months in total), and tailored support will be more appropriate to their circumstances. Tailored support may be reported on a borrower’s credit file, and lenders should inform borrowers where this will be the case.