Income tax
| Tax bands and rates | 2012/13 | 2011/12 | |
| Basic rate band | £34,370 | £35,000 | |
| Basic tax rate | 20% | 20% | |
| Dividend ordinary tax rate | 10% | 10% | |
| Savings rate band | £2,710 | £2,560 | |
| Savings rate | 10% | 10% | |
| Higher rate band | £34,371 - £150,000 | £35,001 - £150,000 | |
| Higher tax rate | 40% | 40% | |
| Dividend higher tax rate | 32.5% | 32.5% | |
| Additional rate band | Over £150,000 | Over £150,000 | |
| Additional tax rate | 50% | 50% | |
| Dividend additional tax rate | 42.5% | 42.5% | |
| Allowances that reduce taxable income | |||
| Personal allowances | under 65 | £8,105 | £7,475 |
| 65 to 74 | £10,500 | £9,940 | |
| 75 and over | £10,660 | £10,090 | |
| Blind person's allowance | £2,100 | £1,980 | |
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Age related allowances are reduced by £1 for each £2 of income above £25,400 (2011/12 £24,000), until the minimum of £8,105 (2011/12 £7,475) is reached. The minimum personal allowance is reduced, by £1 for each £2 of income from £100,000 (2011/12 - £100,000) to £116,210 (2011/12 - £114,950). |
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| Allowances that reduce tax | |||
| Married couple's allowance (MCA) | 78 and over (77 and over in 2011/12) | £7,705 | £7,295 |
| Tax reduction at 10% | £770.50 | £729.50 | |
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The age for MCA is of the elder spouse or civil partner. The loss of tax reduction is 10p for each £2 of income above £25,400 (2011/12 £24,000) until the minimum of £296 (2011/12 £280) is reached. |
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| Non domicile charge | |||
| Charge for adult non UK domiciliary - applies after UK residence in seven or more of the previous tax years |
£50,000 | £30,000 | |
| Tax shelters | |||
|
Enterprise Investment Scheme (EIS) up to |
£1,000,000 | £500,000 | |
| Maximum amount for EIS carry back | £50,000 | £50,000 | |
| Income tax relief | 30% | 30% | |
|
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 rate - registered | 20% | 20% | |
| Higher rate - not registered | 30% | 30% | |
Did you know?
That the Treasury is expecting to raise £154.8 billion from income tax (2011/12 - £152.6 billion).
2013 and beyond
From 2013/14 the age related allowance will be restricted. The allowance of £10,500 for 2012/13 will be restricted to those born after 5 April 1938 but before 6 April 1948. Similarly the £10,660 allowance for 2012/13 will be restricted to those born before 6 April 1938.
Resources
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