TAX RATES, ALLOWANCES AND RELIEFS FOR 2020/2021
|
£ (GBP) |
Income limit for personal allowance |
£100,000 |
Personal allowance |
£12,500 |
Married couple's allowance maximum amount |
£9,075 |
Married couple's allowance minimum amount |
£3,510 |
Transferable Tax Allowance for married couples and civil partners |
£1,250 |
Blind person's allowance |
£2,500 |
Income Tax Rates
Rate on taxable income |
Band, £(GBP) |
Rate,% |
Starting savings rate |
0 - £5,000 |
0* |
Basic rate |
£0 - £37,500 |
20** |
Higher rate |
£37,501 - £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. |
National Insurance Contributions
Weekly earnings £(GBP) |
Not contracted out |
Class I (employment) Employee’s rate |
|
Up to £183 |
Nil |
£183 to £962 |
12% |
Over £962 |
2% |
Employment allowance, per employer, per year* |
£4,000 |
Employer’s rates |
|
Up to £169 |
Nil |
Above £169 |
13.8% |
Class 2 Annual small earning exception is £6,475 per year Class 2 rate per week is £3.05 |
|
Class 4 Lower annual earnings limit is £9,500 |
|
Upper annual earnings limit is £50,000 |
|
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 £962 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 |
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.
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 from 1 January 2019 |
£1,000,000 |
First year allowance (FYA) for business expenditure on new low rate (110g/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 |
100% |
Vehicles with emissions between 50g/km and 110g/km |
18 |
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 |
£25,200 |
Property value is from £5 million to £10 million |
£58,850 |
Property value is from £10 million to £20 million |
£118,050 |
Property value is above £20 million |
£236,250 |
Disposal of ATED property gains are subject to capital gain tax |
28% |
Corporation Tax
Taxable profit £ (GBP)s |
|
Taxable profits (FY 1/04/2020-01/04/2021) |
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 |
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 |
£2,000,000 |
Social Investment Tax Relief |
£1,000,000 |