Income tax rates
| 2011/12 | 2012/13 | ||
|---|---|---|---|
| Basic rate band – income up to | £35,000 | £34.370 | |
| Starting rate for savings | *10% | *10% | |
| Basic rate | 20% | 20% | |
| Dividend ordinary rate | 10% | 10% | |
| Higher rate - income over | £35,000 | £34,370 | |
| Higher rate | 40% | 40% | |
| Dividend upper rate | 32.5% | 32.5% | |
| Additional rate – income over | £150,000 | £150,000 | |
| Additional rate | 50% | 50% | |
| Dividend additional rate | 42.5% | 42.5% | |
| *Starting rate is for savings income up to the starting rate limit of £2,710 (£2,560) within the basic rate band. The rate applies to any balance of the limit remaining after allocating taxable non-savings income. | |||
Personal allowances (ages are as at the end of the tax year)
| Personal allowances | 2011/12 | 2012/13 | |
|---|---|---|---|
| Personal allowances (PA) | under 65 | £7,475 | £8,105 |
| 65 to 74 | £9,940 | £10,500 | |
| 75 and over | £10,090 | £10.660 | |
The personal allowance for those aged under 65 increases from 6 April 2011 to £7,475 and from 6 April 2012 to £8,105. The advantage to higher rate payers is countered by a lowering of the higher rate threshold, to £35,000 from 6 April 2011 and to £34,370 from 6 April 2012.
| Married couple's allowance (MCA) | |||
|---|---|---|---|
| Either partner born before 6 April 1935 (relief restricted to 10%) |
£7,295 | £7.705 | |
| Tax Shelters | ||||
|---|---|---|---|---|
| Enterprise Investment Scheme (EIS) up to | £1,000,000 | £500,000 | ||
| Venture Capital Trust (VCT) up to | £200,000 | £200,000 | ||
| Golden Handshake max. | £30,000 | £30,000 | ||
| Rent a Room - exempt on gross annual rent up to | £4,250 | £4,250 | ||
| Construction Industry Scheme deduction rate: | ||||
| Standard (registered) | 20% | 20% | ||
| Higher (not registered) | 30% | 30% | ||
Notes
- Ages are as the end of the tax year. Ages for the MCA relate to the elder spouse or civil partner
- The higher rates of personal allowances are reduced by £1 for each £2 of excess income over £25,400 (£24,000) until the basic allowance is reached.
- Similar limits apply to the married couple's allowance. The reduction in allowance is subject to a minimum level of £2,960. (For couples married before 5 December 2005, only the husband's income is taken into account. For those married on or after 5 December 2005 or in a civil partnership, only the higher earner’s income is taken into account).
- The personal allowance, including the minimum age-related allowance, is reduced by £1 for every £2 that net adjusted income exceeds £100,000.
- Where there are several trusts created by the same settlor, the "standard rate band" is divided equally between them, subject to a minimum band of £200 for each trust.
