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% |
