Tax rates and allowances

: Last Updated: 13 July 2020

Income Tax rates and allowances (England)

Click here for National Insurance rates

Different Income Tax rates and allowances may apply for other parts of the UK, see:

Income tax: personal allowances and reliefs

	2020/21	2019/20	2018/19	2017/18	2016/17	2015/16	2014/15
Personal allowance PA restricted by £1 for every £2 of income over £100K	12,500	12,500	11,850	11,500	11,000	10,600	10,000
Blind person's allowance	2,500	2,450	2,390	2,320	2,290	2,290	2,230
Transferable marriage allowance (for married couples and civil partners)**	1,250	1,250	1,190	1,150	1,100	1,060
Married Couples Allowance (born before 6 April 1935) Max Min up to 10% of the appropriate Max/Min	9,075 3,510	8.915 3.450	8,695 3,360	8,445 3,260	8,355 3,220	8,355 3,220	8,165 3,140
MCA Limit MCA reduced by £1 for every £2 exceeding limit	30,200	29,600	28,900	28,000	27,700	27,700	27,000
Rent a room relief See Property Income Reliefs	7,500	7,500	7,500	7,500	7,500	7,500	7,500

*Personal allowance restriction: by £1 for every £2 of an individual's adjusted net income above £100,000.

** Transferable allowance: a spouse or civil partner who is not liable to Income Tax above the basic rate may transfer their 'Marriage Allowance' which is 10% of their personal allowance (£1,250 for 2019/20) to their spouse/civil partner, provided that the recipient of the transfer is not liable to Income Tax above the basic rate. Taxpayers have four years in which to make the election.

Income Tax rates

Rate	%	2019/20 & 2020/21	2018/19	2017/18	2016/17	2015/16	2014/15
Basic	20%	£0-37,500	£0-£34,500	£0 -£33,500	£0 -£32,000	£0 - £31,785	£0 to £31,865
Higher	40%	£37,501 to £150,00	£34,501 to £150,000	£33,501 to £150,000	£32,001 to £150,000	£31,786 to £150,000	£31,866 to £150,000
Top	45%	£150,001+	£150,001+	£150,001 +	£150,001 +	£150,001 +	£150,001 +

Child benefit claimants

From 7 January 2013 the High Income Child Benefit Tax Charge provisions clawback Child Benefit payments when a claimant or their partner's income exceeds £50,000.

Dividend tax 2016/17 onwards

The dividend tax credit is abolished.
The first £2,000 of dividend received is tax free (£5,000 for 2016/17 and 2017/18).
Basic rate dividends taxed at 7.5%.
Higher rate dividends taxed at 32.5%.
Upper rate dividends taxed at 38.1%.

Tax rate & effective tax rate on dividends up to 2015/16

Rate	2016/17 to date	2013/14 to 2015/16
Top tax rate	45%	45%
Dividend rate	38.1%	37.5%
Effective rate	na	30.55%
Higher tax rate	40%	40%
Dividend rate	32.5%	32.5%
Effective rate	n/a	25%
Basic rate	7.5%	10%*

* Dividend received net of 10% tax. The amount received needs to be grossed up for higher rate taxpayers by multiplying by 10/9. The dividend rate is then applied according to your tax band

Special rates for trustees income

Rate	2016/17 onwards	2013/14 to 2015/16
Dividend rate: within the first £1,000	7.5%	-
Standard rate: on first £1,000 of other income which would otherwise be taxed at the special rate for trustees	Up to 20% depending on type of income
Trust rate: all other income	45%	45%
Dividend trust rate	38.1%	37.5%

Pensions - higher rate restrictions

Contribution limits	From 2020/21	From 2019/20	From 2018/19	From 2016/17	2014/15 to 2015/16
Annual allowance	£40,000	£40,000	£40,000	£40,000	£40,000
Tapered Annual Allowance with income over	£240,000	£150,000	£150,000	£150,000	n/a