2019/20 | 2020/21 | |
Personal Allowance – The amount of tax-free income you have each tax year | £12,500 | £12,500 |
Limit for Personal Allowance – This is the level of income at which the Personal Allowance reduces by £1 for every £2 you earn over £100,000. | £100,000 | £100,000 |
2019/20 | 2020/21 | |
Tax band name | Tax rate, bands and thresholds | |
Basic rate | 20% - income between £12,501 and £50,000 | 20% - income between £12,501 and £50,000 |
Higher rate | 40% - income between £50,001 and £150,000 | 40% - income between £50,001 and £150,000 |
Additional rate | 45% - income above £150,000 | 45% - income above £150,000 |
The above assumes that the individual has a Personal Allowance of £12,500 in the tax year, which is tax-free income. This Personal Allowance reduces by £1 for every £2 earned over £100,000. | ||
2019/20 | 2020/21 | |
Tax band name | Tax rate, bands and thresholds | |
Starter rate | 19% - income between £12,501 and £14,549 | 19% - income between £12,501 and £14,585 |
Basic rate | 20% - income between £14,550 and £24,944 | 20% - income between £14,586 and £25,158 |
Intermediate | 21% - income between £24,945 and £43,430 | 21% - income between £25,159 and £43,430 |
Higher rate | 41% - income between £43,431 and £150,000 | 41% - income between £43,431 and £150,000 |
Additional rate | 46% - income above £150,000 | 46% - income above £150,000 |
The above assumes that the individual has a Personal Allowance of £12,500 in the tax year, which is tax-free income. This Personal Allowance reduces by £1 for every £2 earned over £100,000. | ||
2019/20 | 2020/21 | |
Small profits threshold amount per year – Profits below this threshold incur no NI Contributions | £6,365 | £6,475 |
Class 2 NIC – Profits above the Small Profits Threshold will incur Class 2 NIC. | £3 per week | £3.05 per week |
Lower Profits Limit - Class 4 NIC's become due above this threshold. | £8,632 | £9,500 |
Upper Profits Limit - Lower rate of Class 4 NIC is due after this threshold (from £50,001) | £50,000 | £50,000 |
Rate of Class 4 NIC between Lower Profits Limit and Upper Profits Limit is 9%. Rate of Class 4 NIC above the Upper Profits Limit is 2%. | ||
2019/20 | 2020/21 | |||
Weekly | Annually | Weekly | Annually | |
Lower Earnings Limit – Earnings below this limit will incur no NICs | £118 | £6,136 | £120 | £6,240 |
Primary Threshold – Earnings below this limit will incur no NICs | £166 | £8,632 | £183 | £9,500 |
Upper Earnings Limit – Earnings above the Primary Threshold and below the Upper Earnings Limit will be taxed at 12%. | £962 | £50,000 | £962 | £50,000 |
Any earnings above the Upper Earnings Limit (UEL), will be taxed at 2% | ||||
2019/20 | 2020/21 | |||
Weekly | Annually | Weekly | Annually | |
Secondary Threshold – Employee's Earnings above this threshold will incur Employer's NIC at 13.8% | £116 | £8,632 | £169 | £8,788 |
Employers can claim up to £4,000 Employers Allowance for 2020/21 tax year, if their Employers Class 1 NI liability in the previous tax year was less than £100,000, are not a public body or a sole director with no other employees. | ||||
2019/20 | 2020/21 | |
Corporation Tax rate | 19% | 19% |
2019/20 | 2020/21 | |
VAT Registration threshold - The total turnover over 12 month period when VAT registration is required (must be done within 30 days of exceeding). | £85,000 | £85,000 |
VAT Deregistration threshold - The total turnover over 12 month period when VAT deregistation can be requested. | Less than £83,000 | Less than £83,000 |
VAT accounting scheme | Threshold to join scheme | Threshold to leave scheme |
£150,000 or less | More than £230,000 | |
£1.35 million or less | More than £1.6 million | |
£1.35 million or less | More than £1.6 million |
|
The dividend tax rates for tax year 2020/21 have not changed since last tax year. |
Type of vehicle | First 10,000 miles | Above 10,000 miles |
Cars and vans | 45p | 25p |
Motorcycles | 24p | 24p |
Bikes | 20p | 20p |
Rates per business mile. Mileage amount (10,000 miles) is per tax year. | ||
