Tax Rates Changes
Tax treatment varies according to individual circumstances and is subject to change.
Please note there are differences in some of the tax rates in Scotland.
Income Tax Rates and Allowances
|Income Tax allowances||2015-16||2016-17||2017-18|
|Personal Allowance (1)||£10,600||£11,000||£11,500|
|Blind Person's Allowance||£2,290||£2,290||£2,290||Age related allowance|
|Personal if born before 6/4/38||£10,600||N/A||N/A|
|Married couples/civil partner at 10% - minimum (2)||£3,220||£3,220||£3,260|
|Married couples/civil partner at 10% - maximum (2)||£8,355||£8,355||£8,445||Dividend and Savings Allowances|
|Dividend Tax Allowance (DTA) (3)||N/A||£5,000||£5,000|
|Personal Savings Allowance (basic rate taxpayer)||N/A||£1,000||£1,000|
|Personal Savings Allowance (higher rate taxpayer)||N/A||£500||£500|
(1a) For those earning over £100,000, the personal allowance is reduced by £1 for every £2 earned so that those earning over £122,000 (2015/16 £121,200).
(1b) Up to 10% of the PA (2016/17:£1,100; 2015/2016: £1,060 2017/18: £1,150) can be transferred to a spouse or civil partner who is no more than a basic rate taxpayer.
(2) Where at least one spouse/civil partner was born before 6 April 1935.
(3) The DTA taxes the first £5,000 of dividend income at nil rather than the rate that would apply otherwise.
Income Tax rates and taxable bands
|Starting rate for savings: 10%*||
|Basic rate: 20%||£0-£31,785||£0-£32,000||£0-£33,500|
|Higher rate: 40%||£31,786- £150,000||£32,001- £150,000||£33,501- £150,000|
|45% from 6 April 2013||Over £150,000||Over £150,000||Over £150,000|
Personal Allowances and Tax Bands
|Year||Personal Allowances||Higher Rate Tax Band|
|2015-2016||£10,600||£31,785 (+£10600 = £42,385)|
|2016-2017||£11,000||£32,000 (+£11000 = £43,000)|
|2017-2018||£11,500||£33,500 (+£11500 = £45,000)|
The new dividend tax
The new dividend tax starts on 06/04/2016 - each individual will receive an annual tax free dividend allowance of £5,000. Dividends will no longer be paid with a notional tax credit and the effective rate of tax will be increased by 7.5%
|TAX RATE 16/17||Taxable income|
|Starting rate 0%
||0 - £5,000|
Income other than dividend: 20%
Dividend income: 7.5%
|0 - £32,000|
Income other than dividend: 40%
Dividend income: 32.5%
|£32,001 - £150,000|
Income other than dividend: 45%
Dividend income: 38.1%
Capital Gains Tax:
The annual exemption for 2016/2017 is £11,100 for individuals
New rates apply on disposals after 6th April 2016 but they do not apply to disposals of residential properties.
|From 6 April 2016||Capital gains tax||Capital gains tax on residential property and carried interest|
|Higher and additional rates||20%||28%|
Note: These tables are provided for guidance only.
Source: HM Revenue & Customs Tax Tables
TAX ADVICE WHICH CONTAINS NO INVESTMENT ELEMENT IS NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.