Rates and Allowances
Income Tax Allowances Table
(go to National Insurance Table)
|
Income tax allowances
|
2007-08
(£)
|
2008-09
(£)
|
|---|---|---|
|
Personal allowance
|
5,225
|
5,435
|
|
Personal allowance for people aged
65-74 (1)
|
7,550
|
9,030
|
|
Personal allowance for people aged
75 and over (1)
|
7,690
|
9,180
|
|
Married couple's allowance (born before 6th April 1935 but aged under 75) (1) (2) |
6,285 | 6,535 |
|
Married couple's allowance - aged 75 and over (1) (2) |
6,365 | 6,625 |
|
Income limit for age-related
allowances
|
20,900
|
21,800
|
|
Minimum amount of married couple's
allowance
|
2,440
|
2,540
|
|
Blind person's allowance
|
1,730
|
1,800
|
(1) - These allowances reduce where the income is above the income limit by £1 for every £2 of income above the limit. They will never be less than the basic Personal allowance or minimum amount of Married Couple’s allowance.
(2) - Tax relief for the Married Couple's allowance is given at the rate of 10 per cent.
Taxable Bands
The Chancellor announces the taxable bands and the rates of tax at the Budget Report which precedes the start of the tax year to which they relate. Generally speaking, Budget takes place in March.
| 2007-08 | £ per year | 2008-09 | £ per year |
|---|---|---|---|
| Starting rate: 10% | £0-£2,230 | ||
| Basic rate:22% | £2,231-£34,600 | Basic rate: 20%* | £0-£36,000 |
| Higher rate: 40% | Over £34, 600 | Higher rate: 40%* | Over £36,000 |
* There will be a new 10% starting rate for savings income only, with a limit of £2320. If an individual’s taxable non-savings income is above this limit then the 10% savings rate will not be applicable. There are no changes to the 10% dividend ordinary rate or the 32.5% dividend upper rate.
Rates and Allowances
National Insurance Contributions
(Back to Income Tax Rates)
|
£ per week
|
2007-08
|
2008-09
|
|---|---|---|
| Lower earnings limit, primary Class 1 |
£87
|
£90
|
| Upper earnings limit, primary Class 1 |
£670
|
£770
|
| Primary threshold |
£100
|
£105
|
| Secondary threshold |
£100
|
£105
|
| Employees’ primary Class 1 rate between primary threshold and upper earnings limit |
11%
|
11%
|
| Employees’ primary Class 1 rate above upper earnings limit |
1%
|
1%
|
| Employees’ contracted-out rebate |
1.6%
|
1.6%
|
| Married women’s reduced rate between primary threshold and upper earnings limit |
4.85%
|
4.85%
|
| Married women’s rate above upper earnings limit |
1%
|
1%
|
| Employers’ secondary Class 1 rate above secondary threshold |
12.8%
|
12.8%
|
| Employers’ contracted-out rebate, salary-related schemes |
3.7%
|
3.7%
|
|
Employers’
contracted-out rebate,
money-purchase schemes
|
1.4%
|
1.4%
|
|
Class 2 rate
|
£2.20
|
£2.30
|
|
Class 2 small earnings
exception
|
£4,635 per year
|
£4,825 per year
|
|
Special Class 2 rate for
share fishermen
|
£2.85
|
£2.95
|
|
Special Class 2 rate for
volunteer development
workers
|
£4.35
|
£4.50
|
|
Class 3 rate
|
£7.80
|
£8.10
|
|
Class 4 lower profits
limit
|
£5, 225 per year
|
£5, 435 per year
|
|
Class 4 upper profits
limit
|
£34, 840 per year
|
£40, 040 per year
|
|
Class 4 rate between
lower profits limit and
upper profits limit
|
8%
|
8%
|
|
Class 4 rate above upper
profits limit
|
1%
|
1%
|