Tax Rates & Allowances

Income Tax Rates

Income Tax Reliefs

Tax Credits

Pension Premiums

Car, Van and Fuel Benefits

Mileage Allowance Payments

Individual Savings Accounts (ISAs)

Corporation Tax

Capital Allowances

Value Added Tax

Capital Gains Tax

Inheritance Tax

Stamp Duty

National Insurance

Main Social Security Benefits

Income Tax Rates

Income tax rates

Rate

%

2018/19

2017/18

2016/17

2015/16

 2014/15

2013/14

2012/13

2011/12

2010/11

Basic*

20%

£0 to £34,500

£0 to £33,500

£0 to £32,000

£0 to £31,785

£0 to £31,865

£0 to £32,010

£0 to £34,370

£0 to £35,000

£0 to £37,400

Higher**

40%

£34,501 to £150,000

£33,501 to £150,000

£32,001 to £150,000

£31,786 to £150,000

£31,866 to £150,000

£32,011 to £150,000

£34,370 to £150,000

£35,001 to £150,000

£37,401 to £150,000

Top

45%

£150,001+

£150,001 +

£150,001 +

£150,001 +

£150,001 +

£150,001 +

-

-

-

Top

50%

-

   

-

-

-

£150,000 +

£150,000 +

£150,000 +

*Starting rate band (see Savings income: tax on interest)

a starting rate applies to savings income up to:

  • £5,000 2018/19 - rate 0%
  • £5,000 2017/18 “ “
  • £5,000 2016/17   " "
  • £5,000 2015/16   " "
  • £2,880 2014/15 - rate 10%
  • £2,790 2013/14   " "
  • £2,710 2012/13   " "
  • £2,560 2011/12   " "
  • £2,440 2010/11   " "
  • £2,320 2008/09 to 2009/10  " "

This band is not available if taxable non-savings income also exceeds this band. Our guide Savings income: tax on interestshows worked examples.

Note the restriction on personal allowances when income is in excess of £100,000 from 2010/11 on.

Income Tax Reliefs

   

2015/16

   

£

Personal allowance - under 65 10,600
  - 65-74* 10,660
  - 75 and over* 10,660

Married couple's allowance

- **

8,355
  - min. amount 3,220
* Age allowance limit   27,700
Bind person's allowance   2,290

Notes

Personal allowances are reduced by £1 for every £2 of adjusted net income over £100,000.

 * Reduce age allowance by £1 for every £2 of excess income over £27,700.

 ** Married couple's allowance relief is restricted to 10% and either partner must be 75 or over and born before 6 April 1935.

   

2014/15

   

£

Personal allowance - under 65 10,000
  - 65-74* 10,500
  - 75 and over* 10,660

Married couple's allowance

- **

8,165
  - min. amount 3,140
* Age allowance limit   25,400
Bind person's allowance   2,230

Notes

Personal allowances are reduced by £1 for every £2 of adjusted net income over £100,000.

 * Reduce age allowance by £1 for every £2 of excess income over £27,000.

 ** Married couple's allowance relief is restricted to 10% and either partner must be 75 or over and born before 6 April 1935.

Tax Credits

 

2015/16

2014/15

 

£

£

Working Tax Credit    
Basic element - max. 1,960 1,940
Childcare element
70% of eligible costs up to £175 per week (£300 if two or more children).
   
Child Tax Credit (CTC)    
Child element per child - max. 2,780 2,750
Family element 545 545
     
Reduction in maximum rates

41% of income above £6,420* p.a.

*If only CTC is claimed, the threshold is £16,010 p.a. (2014/15)

Pension Premiums

2015/16

  • Tax relief available for personal contributions: higher of £3,600 (gross) or 100% of relevant earnings.
  • Any contributions in excess of £40,000, whether personal or by the employer, may be subject to income tax on the individual.
  • Where the £40,000 limit is not fully used it may be possible to carry the unused amount forward for three years.
  • The limit may be reduced to £10,000 once money purchase pensions are accessed.
  • Employers will obtain tax relief on employer contributions if they are paid and made 'wholly and exclusively'. Tax relief for large contributions may be spread over several years.

Car, Van and Fuel Benefits

Company Cars 2015/16

CO2 emissions (gm/km) 
(round down to nearest 5gm/km)
% of car's list price taxed
up to 50 5
51 9
76 13
95 14
100 15
105 16
110 17
115 18
120 19
125 20
130 21
135 22
140 23
145 24
150 25
155 26
160 27
165 28
170 29
175 30
180 31
185 32
190 33
195 34
200 35
205 36
210 and above 37
Company car benefit
  • For diesel cars add a 3% supplement but maximum still 37%.
  • A 0% rate applies to cars which cannot emit CO2 when driven.
  • A 5% rate applies to cars with emissions which do not exceed 50 gm/km when driven. The diesel supplement can apply to 50 gm/km cars.
  • For cars registered before 1 January 1998 the charge is based on engine size.
  • The list price includes accessories and is not subject to an upper limit.
  • The list price is reduced for capital contributions made by the employee up to £5,000.
  • Special rules may apply to cars provided for disabled employees.
Car fuel benefit 2015/16

£22,100 x 'appropriate percentage'*

*Percentage used to calculate the taxable benefit of the car for which the fuel is provided.
The charge does not apply to certain environmentally friendly cars.

The charge is proportionately reduced if provision of private fuel ceases part way through the year. The fuel benefit is reduced to nil only if the employee pays for all private fuel.

Van benefit per vehicle 2015/16

Van benefit £3,150

Fuel benefit £594

The charges do not apply to vans which cannot emit CO2 when driven or if a 'restricted private use condition' is met throughout the year.

Mileage Allowance Payments

 

2015/16 & 2014/15

Cars and vans

Rate per mile

Up to 10,000 miles 45p
Over 10,000 miles 25p
Bicycles 20p
Motorcycles 24p

These rates represent the maximum tax free mileage allowances for employees using their own vehicles for business. Any excess is taxable. If the employee receives less than the statutory rate, tax relief can be claimed on the difference.

Individual Savings Accounts (ISAs)

 

2015/16

2014/15

   

From 1.7.14

to 5.4.15

 

£

£

Overall annual investment limit 15,240 15,000*

 Notes

*Special rules apply if investments were made before 1.7.14. Investments for 2014/15 cannot exceed £15,000 in total.

Corporation Tax

 

Year starting 1.4.15

 
 
Rate
Profits band
£
Rate
%
All  profits 20*
 

Year starting 1.4.14

 
 
Small companies rate
Marginal (small companies) rate
Main rate<
Standard fraction
Profits band
£
Rate
%
0-300,000 20*
300,001-1,500,000
 
21.25*
Over 1,500,000 21*
  1/400*

The profits limits are reduced for accounting periods of less than 12 months and for a company with associated companies.

Capital Allowances

Plant and machinery - Annual Investment Allowance (AIA)

The AIA gives a 100% write-off on most types of plant and machinery costs, including integral features and long life assets but not cars, of up to £500,000 p.a. for expenditure incurred on or after 6 April 2014 (1 April 2014 for companies). The rate may be reduced to £25,000 for expenditure incurred on or after 1 January 2016. Special rules apply for accounting periods straddling these dates.)

Any costs over the AIA fall into the normal capital allowance pools below. The AIA may need to be shared between certain businesses under common ownership.

Other plant and machinery allowances

The annual rate of allowance is 18% (20%) from 6 April 2012 (1 April 2012 for companies). An 8% (10%) rate applies from 6 April 2012 (1 April 2012 for companies) to expenditure incurred on integral features and on long life assets. Special rules apply to accounting periods straddling these dates.

A 100% first year allowance may be available on certain energy efficient plant and cars, including expenditure incurred on new and unused zero emission goods vehicles on or after 6 April 2010 (1 April 2010 for companies).

Cars

For expenditure incurred on cars, costs are generally allocated to one of the two plant and machinery pools. For expenditure incurred on or after 6 April 2013 (1 April 2013 for companies) cars with CO2 emissions not exceeding 130gm/km receive a 18% allowance p.a. Cars with CO2 emissions over 130gm/km receive a 8% allowance p.a.

Value Added Tax

Standard rate 20%
Reduced rate 5%
Annual Registration Limit - from 1.4.15 (1.4.14 - 31.3.15 £81,000) £82,000
Annual Deregistration Limit - from 1.4.15 (1.4.14 - 31.3.15 £79,000) £80,000

Capital Gains Tax

 

2015/16

2014/15 

Individuals

£

 £

Exemption 11,100  11,000
Standard rate 18%  18%
Higher rate* 28%  28%
Trusts    
Exemption 5,550  5,500
Rate 28%  28%

*For higher and additional rate taxpayers

Entrepreneurs' Relief

For disposals on or after 6 April 2011 the first £10m of qualifying gains are charged at 10%. Gains in excess of the limit are charged at the rates detailed above.

Inheritance Tax

Death rate
%

Lifetime rate
%

Chargeable transfers
6 April 2014 to 5 April 2016

Nil Nil 0 - 325,000*
40 20 Over 325,000*

*Potentially increased for surviving spouses or civil partners who die on or after 9 October 2007.

Reliefs

Annual exemptions £3000 Marriage - parent £5,000
Small gifts £250   - grandparent £2,500
      - bride/groom £2,500
      - other £1,000

Reduced charge on gifts within seven years of death

Years before death 0-3 3-4 4-5 5-6 6-7
% of death charge 100 80 60 40 20

Stamp Duty

Land and buildings(on full consideration paid)

Rate

Residential property*

Non-residential**

 
 
Nil
2%
5%
10%
12%
 

£
0-125,000
125,001-250,000
250,001-925,000
925,001-1,500,000
Over 1,500,000
 
   
 £
Nil 0-150,000
1% 150,001-250,000
3% 250,001-500,000
4% Over 500,000
  -
   

* Payable on consideration which falls in each bracket.

** Payable on total consideration once limit is breached.

SDLT is charged at 15% on interests in residential dwellings costing more than £500,000 purchased by certain non-natural persons for acquisitions with an effective date on or after 20 March 2014.

Shares and securities - rate 0.5%.

National Insurance

2015/16 Class 1 (employed) contracted in rates

Employee

Employer

Earnings per week %
Up to £155 Nil*
£155.01-£815 12
Over £815 2
Earnings per week %
Up to £156 Nil*
Over £156 13.8**
   

* Entitlement to contribution-based benefits retained for earnings between £112 and £155 per week.

** The rate is 0% in relation to employees under 21 on earnings up to £815 per week.

Class 1A (employers) 13.8% on employee taxable benefits
Class 1B (employers) 13.8% on PAYE Settlement Agreements
Class 2 (self-employed) flat rate per week £2.80
small earnings exception p.a. £5,965 p.a.
Class 3 (voluntary) flat rate per week £14.10
Class 4 (self-employed) 9% on profits between £8,060 and £42,385 plus 2% on profits over £42,385

 

2014/15 Class 1 (employed) contracted in rates

Employee

Employer

Earnings per week %
Up to £153 Nil*
£153.01-£805 12
Over £805 2
Earnings per week %
Up to £153 Nil*
Over £153 13.8
   

* Entitlement to contribution-based benefits retained for earnings between £111 and £153 per week.

Class 1A (employers) 13.8% on employee taxable benefits
Class 1B (employers) 13.8% on PAYE Settlement Agreements
Class 2 (self-employed) flat rate per week £2.75
small earnings exception p.a. £5,885 p.a.
Class 3 (voluntary) flat rate per week £13.90
Class 4 (self-employed) 9% on profits between £7,956 and £41,865 plus 2% on profits over £41,865

Main Social Security Benefits

Weekly benefit

2015/16 

2014/15

Basic retirement pension
- single person
£115.95 £113.10
- married couple £185.45 £180.90
Statutory pay rates
- average weekly warnings £112 (£111) or over
   
Statutory Sick Pay £88.45 £87.55
Statutory Maternity Pay    
- First six weeks (% of weekly earnings) 90% 90%
- Next 33 weeks £139.58* £138.18*
Statutory Paternity Pay - two weeks £139.58* £138.18*
Statutory Adoption Pay - 39 weeks £139.58 £138.18*

* Or 90% of weekly earnings if lower.

Statutory Sick Pay

Payments may be required from an employer if an employee is too ill to work.

SSP is generally payable for a period up to 28 weeks.

Statutory Maternity Pay

Payments may be required from an employer when an employee takes time off to have a baby.

SMP is payable for a period up to 39 weeks.

Statutory Paternity Pay

Ordinary

Payments may be required from an employer when an employee takes time off during their partner's Statutory Maternity Pay period.

Payment is for a period of either one or two complete weeks.

Additional

Payments may be required from an employer when an employee takes time off following the return to work of their partner following a period of SMP.

Payment is for up to a maximum of 19 weeks and is dependent on the mother's unused SMP period.

Additional Statutory Paternity Pay is replaced for babies due on or after 5 April 2015 by Shared Parental Pay.

Shared Parental Pay

Payments may be required from an employer when an employee takes time off following the curtailment of the period of SMP by the mother.

Payment is for up to a maximum of 37 weeks and is dependent on the mother's unused SMP period.

Statutory Adoption Pay

Payments may be required from an employer when an employee takes time off when they adopt a child.

Payment is for a period up to 39 weeks.

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