TAX RATES, ALLOWANCES AND RELIEFS FOR 2021/2022

 

£ (GBP)

Income limit for personal allowance

£100,000

Personal allowance

£12,570

Married couple's allowance maximum amount (for those born before 6 April 1935)

£9,125

Married couple's allowance minimum amount (for those born before 6 April 1935)

£3,530

Transferable Tax Allowance for married couples and civil partners

£1,260

Blind person's allowance

£2,520

 

Income Tax Rates

Rate on taxable income

Band, £(GBP)

Rate,%

Starting savings rate

 0 - £5,000

0*

Basic rate

 £0 - £37,700

20**

Higher rate

£37,701 - £150,000

40***

Additional rate

 over £150,000

45****

* Starting savings rate is available for savings income only. The rate 0% is not available if taxable non-savings income exceeds £5,000.

Dividend Allowance of £2,000 is tax free. 
** except dividends (7.5%)
*** except dividends (32.5%)
**** except dividends (38.1%)

 

National Insurance Contributions

Weekly earnings £(GBP)

Not contracted out

Class I (employment) Employee’s rate

 

Up to £184

Nil

£184 to £967

12%

Over £967

2%

Employment allowance, per employer, per year*

£4,000

Employer’s rates  

 

Up to £170

Nil

Above £170

13.8%

Class 2

Annual small earning exception is £6,515 per year

Class 2 rate per week is £3.05

 

Class 4

Lower annual earnings limit is £9,568

 

Upper annual earnings limit is £50,270

 

Class 4 rate below lower earnings limit

0%

Class 4 rate between lower and upper earnings limit

9%

Class 4 rate above upper earnings limit

2%

* From 6 April 2020, the employment allowance will only apply to companies with an NIC bill of less than £100,000. No employers NIC for employees aged under 21 (and apprentices up to age 25) on earnings up to £967 per week (the upper earnings limit).

 

 

 Capital Gains Tax

 Standard rate taxpayers

10%

Higher rate taxpayers

20%

Rates for trustees and personal representatives

20%

Individual annual exemption 

£12,300

Trusts annual exemption 

£6,150

Business asset disposal relief (Entrepreneurs’ relief) lifetime limit

£1,000,000

Entrepreneurs' relief rate

10%

Residential property

18% / 28%

 

 Individual Savings Accounts (ISAs) After 1 July 2014

 Max annual contributions – Total overall annual investment limit a combination of amounts between a Cash and Stocks and Shares NISA, up to the overall annual limit of £20,000.

£20,000

 

Stamp Duty (from 4 December 2014)

From 4 December 2014 the SDLT rates were changed by a new regime under which you will only pay the rate of tax on the part of the property price within each tax band.

 3% surcharge in addition to the existing stamp duty land tax rates on additional or rental properties above £40,000 from 1 April 2016.

2% surcharge in addition to the existing stamp duty land tax rates if purchase is of residential property by certain non-UK residents on or after 1st April 2021.

5% surcharge in addition to the existing stamp duty land tax rates if purchase is of an additional residential property and by certain non-UK residents on or after 1st April 2021.

 

Stamp Duty (Initial Temporary Relief Period – 1 April 2021 to 30 June 2021)

Residential 

 

£500,000 or less

Nil

On the next £425,000*

5%

On the next £575,000**

10% / 15%

On the rest (above £1,500,000)

12% / 15%

 

 Stamp Duty (Further Temporary Relief Period – 1st July 2021 to 30th September 2021)

Residential 

 

£250,000 or less

Nil

On the next £625,000*

5%

On the next £575,000

10% / 15%

On the rest (above £1,500,000)

12% / 15%

 

Stamp Duty (Standard rates from 1st October 2021 onwards)

Residential 

 

£125,000 or less

Nil

On the next £125,000*

2%

On the next £675,000**

5% / 15%

On the next £575,000

10% / 15%

On the rest (above £1,500,000)

12% / 15%

Non-residential or mixed use

 

£150,000 or less - annual rent less than 1,000

Nil

£150,001 – £250,000 

2%

Over £250,000

5%

Shares and Securities

 Standard rate - 0.5%, higher rate - 1.5%

Lease rentals (on grant): The net present value is charged at 1% on the excess over £125,000 for residential and 1% on the excess over £150,000 for non-residential or mixed use, land.

1.* The threshold for properties in disadvantaged areas is £150,000

2.** The 15% rate applies to properties over £500,000 purchased on or after 20 March 2014 by ‘non-natural persons’, such as a company

3. Special rules apply to stamp duty land tax on premiums where the annual rent exceeds £1,000

4. 2% surcharge on stamp duty and tax rates on commercial property with a net present value over £5 million

 

Capital Allowances

Annual investment allowance on new purchase of plant and machinery

£200,000

First year allowance (FYA) for business expenditure on new low rate (0g/km) emission vehicles

100%

Writing-down allowances

%

Integral features, long Life plant and machinery and certain cars

6

Structures and buildings

3

Other plant and machinery (main writing down allowance rate)

18

Vehicles with emissions less than or equal to 50g/km

18

Vehicles with emissions between 50g/km and 110g/km

6

Vehicles with emissions over 110g/km

6

 

 Annual Tax on Enveloped Dwellings

 Property value is from £500,000 to £1m

£3,700

Property value is from £1 million to £2 million

£7,500

Property value is from £2 million to £5 million

£25,300

Property value is from £5 million to £10 million 

£59,100

Property value is from £10 million to £20 million

£118,600

Property value is above £20 million

£237,400

Disposal of ATED property gains are subject to capital gain tax

28%

 

Corporation Tax

 Taxable profit £ (GBP)s

Taxable profits (FY 1/04/2021-01/04/2022)

19%

 

 VAT

 Standard Rate

20%

Reduced Rate

5%

Zero Rate

0%

Annual Turnover Limits for registration - last 12 months or if turnover is going to exceed within the next 30 days

£ 85,000

Annual Turnover Limits for de-registration

£ 83,000

 

Digital services tax

From 1 April 2020, a 2% tax on the UK related revenues of certain digital businesses with global in scope revenues exceeding £500m per annum applies to activities comprising search engines, social media platforms and online market places. The first £25m of in scope UK related revenues per annum is not subject to this charge.

 

Inheritance tax

 IHT nil rate

£325,000*

Residence nil rate band (RNRB)

£175,000**

Over £325,000

40%

Lower rate, when 10% or more of estate is left to a charity

36%

Annual Exemption

 

Annual gifts per donor per year

£3,000

Small gifts per donee per year

£250

Wedding gifts to each of your children

£5,000

Wedding gifts to each grandchild

£2,500

Wedding gifts to others

£1,000

*If someone’s estate is less than the Inheritance Tax threshold of £325,000, the remaining threshold can be transferred to their husband, wife or civil partner’s estate when they die.

** The RNRB is tapered by 1 for every £2 that the estate exceeds £2m.

 

 Non-Domiciled Remittance Basis Charges (RBC)

Unremitted income less than 2,000

0%

Resident in the UK at least 7 of previous 9 tax years

£30,000

Resident in the UK at least 12 of previous 14 tax years

£60,000

Resident in the UK at least 17 of the previous 20 tax years, if you’re reporting income you earned before 6 April 2017*

£90,000*

Personal allowance

0

Capital Gains Tax Annual Exemption

0

*Cancelled from 5th April 2017, once non-domiciled individuals were resident in the UK for at least 15 of the 20 tax years, they will be deemed UK domiciled for all tax purposes.

 

 Pension Schemes Allowance

Annual Allowance

£40,000

Lifetime Allowance

£1,073,100

 

Tax efficient Savings and Investment

Venture Capital Trust up to

£200,000

Seed Enterprise Investment Scheme up to

£100,000

Enterprise Investment Scheme

£1,000,000*

Social Investment Tax Relief

£1,000,000

 *£2,000,000 for knowledge intensive companies  

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