Income Tax
Income Tax
Personal allowances
|
2021-22
|
2020-21
|
Personal allowance (PA) |
£12,570 |
£12,500 |
PA restricted by £1 for every £2 of income over |
£100,000 |
£100,000 |
Transferable tax allowance for certain married couples |
£1,260 |
£1,250 |
Blind person's allowance |
£2,520 |
£2,500 |
Married couples' allowance (at least one born pre 6 Apr 1935): Maximum (relief given at 10%) Minimum (relief given at 10%) |
£9,125 £3,530 |
£9,075 £3,510 |
|
Other allowances
|
2021-22
|
2020-21
|
Personal savings allowance: Basic rate Higher rate Top rate |
£1,000 £500 £0 |
£1,000 £500 £0 |
Maximum savings starting rate (non-savings income < PA) Reduces by £1 for every £1 of non-savings income > PA |
£5,000 |
£5,000 |
Dividends allowance |
£2,000 |
£2,000 |
Rent-a-room allowance |
£7,500 |
£7,500 |
Trading allowance |
£1,000 |
£1,000 |
Property allowance |
£1,000 |
£1,000 |
|
Income tax bands and rates
|
2021-22
|
2020-21
|
Basic rate band: Savings Non-savings Dividends Gift aid and pension contributions can extend basic rate band |
£37,700 20% 20% 7.5% |
£37,500 20% 20% 7.5% |
Higher rate band: Savings Non-savings Dividends |
£37,701-£150,000 40% 40% 32.5% |
£37,501-£150,000 40% 40% 32.5% |
Higher rate band: Savings Non-savings Dividends |
£150,000+ 45% 45% 38.1% |
£150,000+ 45% 45% 38.1% |
Rates applicable to trusts: Savings Non-savings Dividends |
45% 45% 38.1% |
45% 45% 38.1% |
|
Non-domicile remittance basis charge (RBC)
|
2021-22
|
2020-21
|
De minimis unremitted foreign income and gains |
£2,000 |
£2,000 |
UK resident 7 of last 9 tax years RBC |
£30,000 |
£30,000 |
UK resident 12 of last 14 tax years RBC |
£60,000 |
£60,000 |
UK resident 17 of last 20 tax years RBC |
N/A |
N/A |
UK resident 15 of last 20 tax years RBC |
Deemed domiciled |
Deemed domiciled |
|
Child benefit
|
2021-22
|
2020-21
|
One child (per week) |
£21.15 |
£21.05 |
Additional children (per week) |
£14.00 |
£13.95 |
Reduced by 1% for every £100 of income over |
£50,000 |
£50,000 |
Child benefit fully repayable if income over |
£60,000 |
£60,000 |
Savings & investments
ISA
|
2021-22
|
2020-21
|
ISA annual limit (cash and shares combined) |
£20,000 |
£20,000 |
Lifetime ISA annual limit |
£4,000 |
£4,000 |
Lifetime ISA withdrawal charge |
20% |
20% |
Help to buy ISA limit per month, initial month extra £1,000 |
£200 |
£200 |
Junior ISA annual limit |
£9,000 |
£9,000 |
|
Venture capital
|
2021-22
|
2020-21
|
Maximum individual investment: Enterprise Investment Scheme (EIS) EIS, where amounts over £1m invested in 'knowledge-intensive companies Seed EIS (SEIS) Venture Capital Trust (VCT) Social Investment Tax Relief (SITR)
|
£1,000,000
£2,000,000 £100,000 £200,000 £1,000,000 |
£1,000,000
£2,000,000 £100,000 £200,000 £1,000,000 |
Maximum income tax reduction: EIS SEIS VCT SITR test |
30% 50% 30% 30% |
30% 50% 30% 30% |
|
Pensions
|
2021-22
|
2020-21
|
Lifetime allowance Excess taxed at: 55% for cash drawn 25% for income drawn |
£1,073,100 |
£1,073,100 |
Annual allowance maximum |
£40,000 |
£40,000 |
Annual allowance minimum |
£4,000 |
£4,000 |
Maximum tax-relieved contributions with no relevant earnings |
£3,600 |
£3,600 |
Money purchase annual allowance |
£4,000 |
£4,000 |
CGT
Exemptions
|
2021-22
|
2020-21
|
Annual exemption for individuals |
£12,300 |
£12,300 |
Annual exemption for trusts generally |
£6,150 |
£6,150 |
Chattels max gain 5/3rds x proceeds less exempt amount of... |
£6,000 |
£6,000 |
|
Rates
|
2021-22
|
2020-21
|
Individuals: Basic rate Above basic rate Additional surcharge applicable to residential property gains |
10% 20% 8% |
10% 20% 8% |
Trusts Additional surcharge applicable to residential property gains |
20% 8% |
20% 8% |
Companies |
See corporation tax |
|
Reliefs
|
2021-22 |
2020-21
|
Business Asset Disposal Relief - qualifying lifetime limit |
£1,000,000 |
£1,000,000 (from 11/3/2020) |
Investors' Relief - qualifying lifetime limit |
£10,000,000 |
£10,000,000 |
Both reliefs result in CGT at 10% on qualifying gains |
IHT
Exemptions and nil rates
|
2021-22
|
2020-21
|
Nil rate band |
£325,000 |
£325,000 |
Residence nil rate band |
£175,000 |
£175,000 |
Maximum at nil rate including nil rate band transfers from spouse |
£1,000,000 |
£1,000,000 |
|
Rates
|
2021-22
|
2020-21
|
Chargeable lifetime transfers |
20% |
20% |
Transfers on, or within seven years of, death (excess over nil rate band) |
40% |
40% |
Transfers on death, where 10% or more left to charity |
36% |
36% |
Taper relief on IHT payable for gifts made within seven years of death |
0 - <3 years 3 - <4 years 4 - <5 years 5 - <6years 6 - <7 years More than 7 years |
0% 20% 40% 60% 80% Exempt |
|
Exemptions
|
2021-22
|
2020-21
|
Gifts to UK domiciled spouse (or non-dom with domicile election) |
Unlimited |
Unlimited |
Gifts to non-domiciled spouse (additional to nil rate band) |
£325,000 |
£325,000 |
Annual exemption (per donor): can be carried forward one year |
£3,000 |
£3,000 |
Small gifts exemption (per donee) |
£250 |
£250 |
Wedding gift from parent |
£5,000 |
£5,000 |
Wedding gift from grandparent |
£2,500 |
£2,500 |
Wedding gift from others |
£1,000 |
£1,000 |
Regular gifts out of income |
Unlimited |
Unlimited |
Business property relief: Controlling interest in listed company Personal assets used by partnership or company you control Interest in a trading business Shares in an unquoted trading company (including AIM-listed) |
50% relief 50% relief 100% relief 100% relief |
50% relief 50% relief 100% relief 100% relief |
Agricultural property relief (applicable to agricultural value) |
100% relief |
100% relief |
VAT
VAT
|
2021-22
|
2020-21
|
Registration threshold (taxable turnover, i.e. excl. exempt) |
£85,000 |
£85,000 |
Deregistration threshold |
£83,000 |
£83,000 |
Rates: Standard Reduced Zero |
20% 5% 0% |
20% 5% 0% |
Fractions: Standard Reduced |
1 / 6 1 / 21 |
1 / 6 1 / 21 |
Cash accounting & annual accounting: Taxable turnover upper limit for joining Taxable turnover upper limit for leaving |
£1,350,000 £1,600,000 |
£1,350,000 £1,600,000 |
Flat rate scheme: Taxable turnover upper limit for joining Anniversary test: leave if total income (incl. exempt) greater than stay if total income in next 12 months will be less than |
£150,000 £230,000 £191,500 |
£150,000 £230,000 £191,500 |
Flat rate scheme limited cost trader (LCT):
LCT applies if spend on relevant goods in the quarter is: Less than total income (incl. exempt) x OR, less than LCT rate (reduce by 1% first 12 months of registration)
|
2% £250 16.5% |
2% £250 16.5% |
Partial exemption de-minimis:
Recover VAT if input VAT attributable to exempt supplies is: on average less than and, as a proportion of total input VAT is no more than
|
£625 per month 50% |
£625 per month 50% |
Stamp Duties & ATED
Stamp Duty
|
2021-22
|
2020-21
|
Newly issued shares |
0% |
0% |
Stocks and marketable securities with consideration over £1,000 |
0.5% |
0.5% |
|
Stamp Duty Land Tax - residential property
|
2021-22
|
2020-21
|
First time buyers where cost of property < £500,000:
£0 - £300,000
£300,000 - £500,000
If the cost is more than £500,000 then the normal rates apply.
|
0%
5%
|
0%
5%
|
£0 - £125,000 |
0% |
0% |
£125,001 - £250,000 |
2% |
2% |
£250,001 - £925,000 |
5% |
5% |
£925,001 - £1,500,000 |
10% |
10% |
£1,500,001 + |
12% |
12% |
Note: owing to Coronavirus, the nil rate of SDLT is extended to £500,000 from 8 July 2020 to 30 June 2021. The nil rate will then fall to £250,000 until 30 September 2021 before returning to £125,000 as above. |
Supplement for second home/buy to let and companies Not applicable if consideration less than |
3% £40,000 |
3% £40,000 |
Higher rate for non-natural person with non-qualifying activity (applies to companies, partnerships with a company partner and collective investment schemes) |
15% if >£500,000 |
15% if >£500,000 |
Surcharge for non-UK residents |
2% |
N/A |
|
Stamp Duty Land Tax - non-residential or mixed property
|
2021-22
|
2020-21
|
£0 - £150,000 |
0% |
0% |
£150,001 - £250,000 |
2% |
2% |
£250,001 + |
5% |
5% |
|
Annual Tax on Enveloped Dwellings
|
2021-22
|
2020-21
|
Applies if market value on valuation date exceeds |
£500,000 |
£500,000 |
Valuation dates |
1 April 2017 |
1 April 2017 |
Annual charge if taxable value is £500,001 - £1,000,000 |
£3,700 |
£3,700 |
£1,000,001 - £2,000,000 |
£7,500 |
£7,500 |
£2,000,001 - £5,000,000 |
£25,300 |
£25,200 |
£5,000,001 - £10,000,000 |
£59,100 |
£58,850 |
£10,000,001 - £20,000,000 |
£118,600 |
£118,050 |
£20,000,001 + |
£237,400 |
£236,250 |
Corporation Tax & Capital Allowances
Corporation Tax
|
2021-22
|
2020-21
|
Rate |
19% |
19% |
S455 tax on loans to participators |
32.5% |
32.5% |
|
Patent box and R&D
|
2021-22
|
2020-21
|
Patent box effective rate |
10% |
10% |
Research and development (R&D) capital expenditure relief |
100% |
100% |
R&D total enhanced deduction for SMEs |
230% |
230% |
R&D tax credit rate on surrendable loss for SMEs |
14.5% |
14.5% |
R&D large company above the line credit |
13% |
13% |
|
Capital allowances
|
2021-22
|
2020-21
|
Annual Investment Allowance (100%) up to |
£1,000,000 to 31 December 2021, then £200,000 |
£1,000,000 |
Super deduction (expenditure between 1 April 2021 and 31 March 2023) |
130% |
N/A |
Super deduction (special rate assets) |
50% |
N/A |
Plant and machinery general pool writing down allowance (WDA) |
18% |
18% |
Integral features and certain long-life assets WDA |
6% |
6% |
Small pool WDA where balance <£1,000 |
100% |
100% |
FYA for electric charge-points |
100% |
100% |
Structures and buildings allowance (SBA) |
3% |
3% |
|
Capital allowance - cars
|
2021-22
|
2020-21
|
New and unused with CO2 emissions of 0g/km |
100% |
100% |
New and unused with CO2 emissions of up to 50g/km |
18% |
100% |
New and second hand up to 110g/km |
6% |
18% |
New and second hand above 110g/km |
6% |
6% |
Include cars used by sole traders or partnerships with private use in a single asset pool |
National Insurance
National Insurance Contributions
Class 1 (Employers & Employees)
|
2021-22
|
2020-21
|
|
Employee |
Employer |
Employee |
Employer |
Main NIC rate |
12% |
13.8% |
12% |
13.8% |
No NIC on first |
£184 pw |
£170 pw |
£183 pw |
£169 pw |
Main rate charged up to |
£967 pw |
No limit |
£962 pw |
No limit |
2% on earnings above |
£967 pw |
N/A |
£962 |
N/A |
Employment allowance per business* |
N/A |
£4,000 |
N/A |
£4,000 |
* Certain businesses do not qualify e.g. sole director companies and employers with an employer’s Class 1 NIC liability of £100,000 or more.
Self-employed (TBA for 2021/22)
|
2021-22 |
2020-21 |
Class 2 (Self employed) |
|
|
Flat rate per week |
£3.05 |
£3.05 |
Small profits threshold |
£6,515 |
£6,475 |
Class 3 (Voluntary) |
|
|
Flat rate per week |
£15.40 |
£15.30 |
Class 4 (Self employed) |
|
|
On profits £9,568 to £50,270 |
9.0% |
9.0% |
On profits over £50,270 |
2.0% |
2.0% |