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Tax Rates & Allowances
Below you will find this years and last years tax rates and allowances. Find out how much personal and business tax allowance you are entitled to and then contact us to make sure you get it
Income Tax
| Personal allowance |
2011/12 |
2010/11 |
| under 65 (1) |
£7,475 |
£6,475 |
| Income limit for Personal Allowance |
£100,000 |
£100,000 |
| 65 to 74 |
£9,940 |
£9,490 |
| 75 and over |
£10,090 |
£9,640 |
| Blind person’s allowance |
£1,980 |
£1,890 |
(1) From 2010/2011 tax year the personal allowance reduces where the income is above £100,000 - by £1 for every £2 of income above the £100,000 limit. This reduction applies irrespective of age.
Tax Rates
| |
2011/12 |
2010/11 |
| Savings starting rate band to |
£2,560 |
£2,440 |
| Savings starting tax band rate |
10% |
10% |
| Basic rate band |
£35,000 |
£37,400 |
| Basic tax rate |
20% |
20% |
| Higher rate – taxable income |
£35,001 - £150,000 |
£37,400 - £150,000 |
| Higher tax rate |
40% |
40% |
| UK Dividend rate |
32.5% |
32.5% |
| Additional rate |
over £150,000 |
over £150,000 |
| Additional tax rate |
50% |
50% |
| UK Dividend rate |
42.5% |
42.5% |
Corporation Tax
Corporation tax rates and bands are as follows:
| Financial year to |
31 March 2012 |
31 March 2011 |
| Taxable profits |
| First £300,000 |
20% |
21% |
| Next £1,200,000 |
27.5% |
29.75% |
| On profits over £1,500,000 |
26% |
28% |
| Tax credits on Dividends |
10% |
10% |
| Marginal relief fraction |
3/200 |
7/400 |
Corporation Tax payable
For small and medium sized companies
- Nine months and 1 day after the end of the accounting period
Mileage Allowances
For Employees Using Their Own Transport
The approved maximum tax and national insurance free mileage allowances for employees using their own transport for business are as follows:
| Flat Rate |
First 10,000 Miles |
Miles over 10,000 |
| Car |
45p |
25p |
| Motorcycle |
24p |
24p |
| Bicycle |
20p |
20p |
Income Tax and NICs are due when allowances exceed these rates. Employees can claim tax relief on any shortfall.
Rates of up to 5p per mile, per passenger, are also tax and NIC free when paid for the carriage of fellow employees on the same business trip.
Value Added Tax
| |
From 1 April 2011 |
From 1 January 2010 |
| Standard rate |
20% |
17.5% |
| Standard rate VAT fraction |
1/6 |
7/47 |
| Reduced rate |
5% |
5% |
| Reduced rate VAT fraction |
1/21 |
1/21 |
| Taxable Turnover Limits |
| Registration – last 12 months or next 30 days over |
£73,000 |
£70,000 |
| Deregistration – next 12 months under |
£71,000 |
£68,000 |
| Cash accounting scheme – up to |
£1,600,000 |
£1,600,000 |
| Optional flat rate scheme – up to |
£150,000 |
£150,000 |
| Annual accounting scheme – up to |
£1,350,000 |
£1,350,000 |
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