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Tax Rates and Allowances

Article ID: 2435
Last updated: 23 Aug, 2016

Please select from below:

Income Tax
Income Tax Allowances
2016/17 2015/16 2014/15
Personal Allowance (1) £11,000 N/A N/A
Born after 5 April 1948 N/A £10,600 £10,000
Born between 6 April 1938 and 5 April 1948 N/A £10,600 £10,500
Born before 6 April 1938 N/A £10,660 £10,660
Personal Savings Allowance – Basic Rate Taxpayers
Personal Savings Allowance – Higher Rate Taxpayers
£1,000
£500
N/A N/A
Income Limit for Personal Allowance (2) £100,000 £100,000 £100,000
Income limit for age-related allowances (Married Couples Allowance from 2016/17) (3) £27,700 £27,700 £27,000
Blind Person’s allowance £2,290 £2,290 £2,230
Married Couple’s allowance (2) (4) £8,355 £8,355 £8,165
Transferable Tax Allowance for married couples and civil partners (5) £1,100 £1,060 N/A
Dividend allowance (6) £5,000 N/A N/A
Rent a room limit £7,500 £4,250 £4,250
  1. From 2016-17 onwards, all individuals will be entitled to the same personal allowance, regardless of the individuals' date of birth.
  2. The personal allowance is reduced by £1 for every £2 of income in excess of the £100,000 limit irrespective of date of birth.
  3. Allowances for individuals born before 6 April 1948 reduce by £1 for every £2 of income in excess of the income limit, reducing to the standard personal allowance (£11,000). Such allowances can be reduced further under (2).From 2016-17 the only age-related allowances will be married couples allowance see (1)
  4. The relief is limited to 10% and can only be claimed if at least one spouse was born before 6 April 1935. The allowance is reduced where income exceeds the age related income limit, down to a minimum of £3,220 2016/2017 (£3,220 2015/2016). Please note the allowance extends to Civil Partnerships.
  5. Available to those born after 5 April 1935. It allows a spouse or civil partner who is not liable to income tax above the basic rate to transfer this amount of their personal allowance to their spouse/civil partner. The recipient must not be liable to tax above the basic rate.
  6. From April 2016, the new Dividend Allowance means that individuals will not have to pay tax on the first £5,000 of dividend income they receive.
Tax bands and corresponding tax rates
2016/17 2015/16 2014/15
Starting Rate for savings income (1) 0% 0% 10%
Basic Rate 20% 20% 20%
Higher Rate 40% 40% 40%
Additional Rate 45% 45% 45%
Dividend ordinary rate - otherwise taxable at basic rate (effective rate with tax credit)(2) 7.5% 10% (0%) 10% (0%)
Dividend upper rate - otherwise taxable at higher rate (effective rate with tax credit)(2) 32.5% 32.5% (25%) 32.5% (25%)
Dividend additional rate - otherwise taxable at additional rate (effective rate with tax credit)(2) 38.1% 37.5% (30.6%) 37.5% (30.6%)
Starting Rate limit (Savings income) (1) £5,000 £5,000 £2,880
Basic Rate £5,001 - £32,000 £5,001 - £31,785 £2,881 - £31,865
Higher Rate £32,001 - £150,000 £31,786 - £150,000 £31,866 - £150,000
Additional Rate Over £150,000 Over £150,000 Over £150,000
  1. From 2008-09 there has been a starting rate for savings income only. If an individual’s taxable non-savings income exceeds the starting rate limit, then the starting rate for savings will not be available for savings income.
  2. From April 2016 the dividend tax credit will be abolished and replaced with a new £5,000 Dividend Allowance
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National Insurance Contributions
Rates
2016/17 2015/16 2014/15
Class 1 (Earnings between Primary and Upper earnings limits) 12% 12% 12%
Class 1 (Earnings above Upper earnings limit) 2% 2% 2%
Class 1A (Employers NI earnings over Primary earnings limit) 13.8% 13.8% 13.8%
Class 1A (Employers NI on Benefits) 13.8% 13.8% 13.8%
Class 2 (Flat rate for self-employed) £2.80 per week £2.80 per week £2.75 per week
Class 3 (Voluntary) £14.10 per week £14.10 per week £13.90 per week
Class 4 (Self-Employed Profits between Lower and Upper earnings limits) 9% 9% 9%
Class 4 (Self-Employed profits above Upper earnings limit) 2% 2% 2%
Thresholds
2016/17
Per week
2015/16
Per week
2014/15
Per week
Weekly Lower Earnings Limit (LEL) (1) £112 £112 £111
Weekly Primary Threshold (PT) (1) £155 £155 £153
Secondary Threshold (ST) (2) £156 £156 £153
Upper Earnings (UEL) £827 £815 £805
Upper Profits Limit (UPL) £43,000 per year £42,385 per year £41,865 per year
Upper Secondary Thresholds for U21’s (3) £827 £815 N/A
Small Earnings Exception (SEE)/Small Profits Threshold (SPT) (1) £5,965 per year £5,965 per year £5,885 per year
Lower Profits Limit (LPL) (1) £8,060 per year £8,060 per year £7,956 per year
Employment Allowance £3,000 per year £2,000 per year £2,000 per year
Apprentice Upper Secondary Threshold (AUST) for under 25’s £827 N/A N/A
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Working and Child Tax Credits
Working Tax Credit
2016/17 2015/16 2014/15
Basic Element £,1960 £,1960 £,1940
Couple and lone parent element £2,010 £2,010 £1,990
30 hour element £810 £810 £800
Disabled worker element £2,970 £2,970 £2,935
Severe disability element £1,275 £1,275 £1,255
CHILDCARE ELEMENT
Maximum eligible cost for one child £175 per week £175 per week £175 per week
Maximum eligible cost for two or more children £300 per week £300 per week £300 per week
Percent of eligible costs covered 70% 70% 70%
Child Tax Credit
2016/17 2015/16 2014/15
Family element £545 £545 £545
Child element £2,780 £2,780 £2,750
Disabled child element £3,140 £3,140 £3,100
Severely disabled child element £1,275 £1,275 £1,255
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Child Benefit and Guardian's Allowance
2016/17
Per week
2015/16
Per week
2014/15
Per week
Child Benefit – First Child £20.70 £20.70 £20.50
Child Benefit – Second and subsequent children £13.70 £13.70 £13.55
Guardian’s Allowance £16.55 £16.55 £16.35
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Tax Free Savings Accounts
2016/17 2015/16 2014/15
Individual Savings Account (ISA) subscription limit £15,240 £15,240 £15,000 (1)
Junior ISA subscription limit £4,080 £4,080 £4,000 (2)
Child Trust Fund (CTF) subscription limit £4,080 £4,080 £4,000 (2)
Help to Buy ISA – Government Bonus up to (3) £3,000 £3,000 N/A
  1. Took effect from 1 July 2014, between 2 April and 30 June 2014 the total annual subscription limit for 2014/15 was £11,880 of which up to £5,940 could be placed in a cash ISA.
  2. Took effect from 1 July 2014, Between 2 April and 30 June 2014 the junior ISA and CTF annual subscription limit for 2014/15 was £3,840.
  3. (3) HMRC will uplift 25% of contributions into the ISA for first time buyers, so for every £200 paid in HMRC will add £50.
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Fuel Benefit Charge
2016/17 2015/16 2014/15
Car fuel benefit charge multiplier £22,200 £22,100 £21,700
Van fuel benefit charge £598 £594 £581
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Van Benefit Charge
2016/17 2015/16 2014/15
Van benefit charge £3,170 £3,150 £3,090
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Capital Gains Tax
2016/17 2015/16 2014/15
For taxpayers gains falling in the basic rate tax band (residential property and carried interest) 10% (18%) 18% 18%
For trustees and taxpayers gains falling into higher/additional rate tax bands (residential property and carried interest) 20% (28%) 28% 28%
Annual Exempt Amount – Individuals £11,100 £11,100 £11,000
Annual Exempt Amount – Trusts £5,550 £5,550 £5,500
Entrepreneurs relief lifetime limit £10m £10m £10m
Entrepreneurs rate 10% 10% 10%
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VAT
VAT Rates
Budget 2016 Since 4/1/11 Pre 4/1/11
Standard rate 20% 20% 17.5%
Reduced rate 5% 5% 5%
Registration Thresholds
2016/17 2015/16 2014/15
Registration threshold £83,000 £82,000 £81,000
De-registration theshold £81,000 £80,000 £79,000
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Capital Allowances
Expenditure on:
2016/17 2015/16 2014/15
Plant & Machinery (1) 18% 18% 18%
Plant & Machinery in certain enterprise zones 100% 100% 100%
Motor cars on or after April 2009 – CO2 emissions
<75g/km 100% 100% 100%
>76g/km – 130g/km (1) 18% 18% 18%
>130g/km (1) 8% 8% 8%
Over £12,000 and acquired before 2009/10 (2) 18% 18% 18%
New and unused zero emission goods vehicles 100% 100% 100%
Long life assets / integral features in buildings (1) 8% 8% 8%
Research and Development 100% 100% 100%
Energy saving and water efficient plant and machinery 100% 100% 100%
Renovation of business premises (disadvantaged areas) 100% 100% 100%
  1. Allowances are given on a reducing basis
  2. Reducing balance (maximum £3,000). Unclaimed allowances transfer to the main pool in the accounting period ending on or after 31 March/5 April 2014
Annual Investment Allowance
After 31/12/15 1/04/2014 – 31/12/15 01/01/13 – 31/03/14
100% allowance up to £200,000 £500,000 £250,000
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Corporation Tax
2016/17 2015/16 2014/15
£1 - £300,000 20% 20% 20%
£300,001 - £1,500,000 20% 20% 21.25%
Over £1,500,000 20% 20% 21%
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Authorised Mileage Rates
2016/17
Per mile
2015/16
Per mile
2014/15
Per mile
CARS
First 10,000 miles 45p 45p 45p
Additional miles 25p 25p 25p
Each qualifying passenger 5p 5p 5p
OTHER VEHICLES
Motorcycles 24p 24p 24p
Bikes 20p 20p 20p
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Pension Contributions
2016/17 2015/16 2014/15
Annual Allowance £40,000 (2) £40,000 £40,000
Lifetime Allowance £1m £1.25m £1.25m
  1. Tax relief is given for pension contributions up to the lower of 100% of earnings or the maximum contribution. The maximum contribution is the annual allowance plus unutilised annual allowances from the three previous years. Up to £3,600 may be contributed to a pension irrespective of earnings.
  2. For 2016/17 annual allowance reduced by £1 for every £2 income over £150,000 to a minimum of £10,000.
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Inheritance Tax
2016/17 2015/16 2014/15
Nil Rate Band £1 – £325,000 0% 0% 0%
Over £325,000 40% 40% 40%
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Stamp Duty
INCREMENTAL RATES AS OF 4/12/14 Primary Property Additional Properties
£1 - £125,000 Nil 3% (1)
£125,001 - £250,000 2% 5%
£250,001 - £925,000 5% 8%
£925,001 - £1,500,000 10% 13%
Above £1,500,000 12% 15%
OLD SLAB TREATMENT - PRE 04/12/14
£1 - £150,000 Nil
£150,000 - £250,000 1%
£250,001 - £500,000 3%
Above £500,001 4%
  1. Purchases below £40,001 will be exempt from the SDLT surcharge
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Article ID: 2435
Last updated: 23 Aug, 2016
Revision: 7
Views: 11951
This article was:  



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