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For financial advisers - compiled by our team of experts, qualified in pensions, taxation, trusts and wealth transfer.

Tax tables

26 March 2021

Key points

  • Quick reference guide for essential tax rates, thresholds and allowances
  • Provided for information only - further professional advice may be needed for individual circumstances

Jump to the following sections of this guide:

Income Tax rates for individuals

UK rates

Over £150,000 45 Over £150,000 45
2020/21  2021/22 
Bands of taxable income % Bands of taxable income %
(£1 - £5,000) * 0 (£1 - £5,000) * 0
£1 - £37,500 20 £1 - £37,700 ** 20
£37,501 - £150,000 40 £37,701 - £150,000 40

* There's a starting rate band taxed at 0% which applies to savings income up to a maximum of £5,000. The £5,000 band reduces by £1 for every £1 of non-savings income over the personal allowance (£12,500 in 2020/21 and £12,570 in 2021/22). If an individual's taxable non-savings income is over £17,500 (2020/21) or £17,570 (2021/22) the 0% starting rate for savings won't apply.

** The basic rate band will be frozen at £37,700 until April 2026.

Dividend income is taxed at 7.5% (income up to the basic rate), 32.5% (higher rate) and 38.1% (additional rate). Every individual has a dividend allowance of £2,000. Dividends within the allowance are taxed at 0%.

Scottish resident taxpayers – non-savings income

Over £150,000 46 Over £150,000 46
2020/21  2021/22 
Bands of taxable income % Bands of taxable income %
£1 - £2,085 19 £1 - £2,097 19
£2,086 - £12,658 20 £2,098 - £12,726 20
£12,659 - £30,930 21 £12,727 - £31,092   21
£30,931 - £150,000 41 £31,093 - £150,000 41

The Scottish rates and bands apply to non-savings income such as salary, pension and rental income. Savings and investment income continues to be taxed at the UK rates.

Income Tax rates for trusts

Dividend income 7.5% 38.1%
  Interest in Possession
2021/22
* Discretionary
2021/22
Savings income 20% 45%
Rental income 20% 45%

* The first £1,000 of taxable trust income is charged at 20%, or 7.5% for dividend income. The £1,000 band is shared between all trusts created by the same settlor subject to a minimum of £200 per trust.

Income Tax allowances and reliefs

Marriage allowance
(Transferable unused personal allowance for married couples and civil partners born after 5 April 1935)
£1,250 £1,260
Allowance 2020/21 2021/22

Personal allowance

£12,500

£12,570 *
Income limit for personal allowance
£100,000 £100,000

(Allowance reduced by £1 for every £2 of "adjusted net income"  above £100,000. No personal allowance after £125,000 for 2020/21 and £125,140 for 2021/22).
*
The personal allowance will be fixed at £12,570 until April 2026.

   
Personal Savings Allowance
 
   
   - basic rate tax payers £1,000 £1,000
   - higher rate tax payers  £500 £500
   - additional rate taxpayers

Nil Nil
Dividend allowance

£2,000 £2,000
Married couple's allowance
(relief at 10% of allowance for married couples and civil partners where at least one is born before 6 April 1935)

   
   - maximum allowance £9,075 £9,125
   - minimum allowance

£3,510 £3,530
(Allowance is reduced by £1 for every £2 of "adjusted net income"above the income limit until it reaches the minimum amount. Any reduction in the married couple's allowance applies after any reduction to the individual's personal allowance).

   
Income limit for Married couple's allowance

£30,200 £30,400
Blind person's allowance

£2,500 £2,520

 

Venture Capital Trust (relief at 30%) £200,000 £200,000
Enterprise Investment Scheme (relief at 30%) £2M* £2M*
Seed Enterprise Investment Scheme (relief at 50%) £100,000 £100,000

*Any investment over £1million must be invested in knowledge-intensive companies.

Capital Gains Tax rates for individuals 

Over £12,300 10% & 20% **/ 18% & 28% Over £12,300 10% & 20% **/ 18% & 28%
2020/21 2021/22
Gains Rate% Gains Rate%
Up to £12,300 * Nil Up to £12,300 * Nil

* CGT annual exemption will be fixed at £12,300 until April 2026 for individuals and personal representatives.

** A rate of 20% / 28% is payable by individuals with capital gains in excess of their annual exemption which, when added to their income, exceed the income tax higher rate threshold (£37,500 for 2020/21 and £37,700 for 2021/22). Where the income and capital gains don't exceed the threshold, the rate of 10% / 18% will apply and gains straddling the threshold will pay 10% / 18% on the amount of gain below the threshold and 20% / 28% above it.

Individuals will pay 18% or 28% on gains on residential property that are ineligible for Private Residence Relief.

Entrepreneurs' relief (aka business asset disposal relief) is available for qualifying business disposals.

Capital Gains Tax rates for trusts

Over £6,150 20% / 28% Over £6,150 20% / 28%
2020/21 2021/22
Gains Rate % Gains Rate %
Up to £6,150 * Nil Up to £6,150 * Nil

* The annual exemption will be fixed at £6,150 until April 2026. This is shared between all trusts created by the same settlor, subject to a minimum per trust of £1,230.

Trusts will continue to pay 28% on gains on residential property that do not receive principal private residence relief.

Gains arising on bare trusts are not taxable upon the trustees but instead are taxed upon the beneficiary and the rules for individuals will apply.

Entrepreneurs' relief (aka business asset disposal relief) is available for qualifying business disposals.

Inheritance Tax rates

40%** 20% Over £325,000 Over £325,000
Residential Nil Rate Band ***   £175,000 £175,000
Death Rate Lifetime Rate Chargeable Transfers
2020/21
Chargeable Transfers
2021/22
Nil Nil £0 - £325,000 * £0 - £325,000 *

* The Nil Rate Band and Residence Nil Rate Band will be fixed at £325,000 and £175,000 until April 2026.

** Reduced to 36% where at least 10% of the net estate is left to charity.

*** Net estates over £2,000,000 have RNRB reduced by £1 for every £2 and lost when estate is £2,350,000.

6-7 20
Rates of charge on certain gifts within seven years of death
Years between gift and death % of death rate charge
0-3 100
3-4 80
4-5 60
5-6 40

Exemptions

The following are the main exemptions which are available in certain circumstances:

  • Gifts to spouses/civil partners (limited if transferor is UK domiciled and spouse is non-UK domiciled).
  • Annual allowance of £3,000 per tax year.
  • Small gifts up to £250 per tax year to individuals.
  • Normal expenditure out of income.
  • Gifts in consideration of marriage/civil partnership (£5,000 by a parent, £2,500 by a party to the marriage/civil partnership, or remoter relative, or £1,000 by any other person).
  • Gifts to UK charities.

Not all the above exemptions may be available at the same time.

National Insurance rates & contributions

NI rates and contributions from 6 April 2021:

Profits over £50,000 2%
Class 1 (Employment) Weekly Yearly
Lower earnings limit (LEL) £120  £6,240
Upper earnings limit (UEL)

£967 £50,270
Primary earnings threshold £184 £9,568
Secondary earnings threshold

£170 £8,840
Employee contribution rates

 
Employee rate (on earnings between primary threshold and UEL) 12%
Reduced rate for married women and widows 5.85%
Earnings above UEL (including that for married women and widows) 

2%
Employer contribution rates (on earnings above secondary earnings threshold)
  


Employer rate

Employer contributions on earnings above the UEL are assessed at the same rate.

13.8%
Class 2 (Self-employed)
 


Profits of £6,515 or more

£3.05 a week
Class 3 (Voluntary)

£15.40 a week
Class 4 (Self-employed, additional levy)
 
 
Profits between £9,568 and £50,270 9%

Individuals don't pay National Insurance beyond State pension age, but employer contributions continue.

Corporation Tax rates

Unified rate on all profits 19% 19%
Rate Financial year
2020/21
Financial year
2021/22

Corportation tax rates from 1 April 2023

The main rate will be set at 25%.

A small profits rate of 19% will be introduced for companies with profits of £50,000 or less.

The rate for companies with profits between £50,000 and £250,000 will gradually increase from 19% to 25%.

Registered Pension Schemes

Lifetime allowance

2021/22 £1,073,100
Tax Year Standard lifetime allowance
2020/21 £1,073,100

 The lifetime allowance will be frozen at this level until April 2026.

A higher lifetime allowance is available to those who have fixed protection 2012 (£1.8M), fixed protection 2014 (£1.5M), fixed protection 2016 (£1.25M), individual protection 2014, individual protection 2016 or a lifetime allowance enhancement factor (for example, those with primary protection).

The lifetime allowance charge is:

  • 55% of excess over lifetime allowance if taken as a lump sum.
  • 25% of excess over lifetime allowance if taken in the form of income, which is subsequently taxed under PAYE.

Annual allowance 

2021/22 £40,000 *
Tax Year Annual allowance
2020/21 £40,000 *

* Some individuals with 'adjusted income' above £240,000 will have their annual allowance reduced by £1 for every £2 over that level in the tax year, until their annual allowance drops to £4,000.

Unused annual allowance in respect of the previous three tax years can be carried forward in some circumstances.

Individuals who have flexibly accessed pension benefits are subject to a money purchase annual allowance (MPAA) of £4,000 and no money purchase carry forward.

The annual allowance charge is a variable charge of up to 45% (46% for Scottish residents) on the amount of total pension input in excess of the annual allowance.

Contributions

  • Member - unlimited. Tax relief limited to the higher of £3,600 or 100% of relevant UK earnings.
  • Employer - unlimited. Normally tax relief is claimable, but the employer's local inspector of taxes decides to what extent it will be given.

Individual Savings Accounts (ISA) limits

LISA (age 18-40) £4,000 * £4,000 *
Maximum contribution 2020/21 2021/22
ISA £20,000 £20,000
Junior ISA £9,000 £9,000

* Contributions by an individual to a LISA are included within the overall maximum ISA contribution of £20,000.

State Pension

Savings element up to £15.62 up to £15.71
  2020/21
(per week)

2021/22 (per week)

Basic State Pension (SPA* before 6 April 2016)    
Single person £134.25  £137.60
Married couples/civil partners

£214.70 £220.05
New State Pension (SPA* after 5 April 2016)
 
£175.20 £179.60
State Pension Credit (single person)    
Guaranteed element £173.75 £177.10
Savings element

up to £13.97 up to £14.04
State Pension Credit (married couple and civil partners)    
Guaranteed element £265.20 £270.30


* SPA = State Pension Age.

Important tax dates

Income Tax

Tax returns 31 January after the end of the tax year for online returns.

31 October after the end of the tax year for paper tax returns.

If the individual receives the tax return after 31 July, the deadline is three months following the date of issue of the notice.

30 December after the end of the tax year for an online return if HMRC to collect tax through PAYE tax code (where possible) if the amount of tax owed is less than £3,000
Payments on account 31 January during the tax year, and 31 July following the end of the tax year. Normally each of these will be half* of the tax due for the previous tax year.

* If you know that your income for the current year will be lower than the previous year's income, you can ask HMRC to reduce your payments on account. But if HMRC later find that extra tax was due, you'll have to pay interest on it. You may also have to pay a penalty if you've asked HMRC to reduce the payments without taking proper care.

Balancing Payment 31 January following the end of the tax year.

Employee P11d 6 July after the end of the tax year.

Capital Gains Tax

31 January (online returns) or 31 October (paper returns) following the end of the tax year in which the gain has arisen.

From 6 April 2020 CGT on sale or disposal of residential property must be reported (online) and tax paid within 30 days of the transaction.

Corporation Tax

Stand alone companies with taxable profit up to £1.5M - nine months and one day after the end of the accounting period (AP).

Companies with taxable profits over £1.5M ** - will pay Corporation Tax in four equal quarterly instalments starting between the sixth and seventh month of the AP and based on estimated liabilities.

** Excludes companies whose profits in the immediately preceding period were less than £1.5M and in the current period less than £10M.

Inheritance Tax

Lifetime Transfer Normally six months after the end of the month in which the transfer is made.
Death Normally six months after the end of the month in which death occurred.
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