• Main allowances

    Main allowances2017/182016/17
    Personal Allowance (PA)*† £11,500 £11,000
    Blind Person's Allowance 2,320 2,290
    Rent a room relief ** 7,500 7,500
    Trading income ** 1,000 N/A
    Property income ** 1,000 N/A

    *PA will be withdrawn at £1 for every £2 by which ‘adjusted income’ exceeds £100,000. There will therefore be no allowance given if adjusted income is £123,000 or more (2016/17: £122,000).

    † 10% of the PA (2017/18: £1,150; 2016/17: £1,100) can be transferred to a spouse or civil partner who is no more than a basic rate taxpayer.

    ** If gross income exceeds this limit, the limit may be deducted instead of actual expenses.

    Rate Bands2017/182016/17
    Basic rate band (BRB) £33,500 £32,000
    Higher rate band (HRB) 33,501-150,000 32,001-150,000
    Additional rate over 150,000 over 150,000
    Scottish taxpayers
    – BRB 31,500 32,000
    – HRB 31,501-150,000 32,001-150,000
    Personal Savings Allowance (PSA)
    – Basic rate taxpayer 1,000 1,000
    – Higher rate taxpayer 500 500
    Dividend Nil Rate Band (DNRB) 5,000 5,000

    BRB and additional rate threshold are increased by personal pension contributions (up to permitted limit) and Gift Aid donations.

    Tax Rates2017/18 and 2016/17
    Rates differ for General, Savings and Dividend income G S D
    Basic rate 20% 20% 7.5%
    Higher rate 40% 40% 32.5%
    Additional rate 45% 45% 38.1%

    General income (salary, pensions, business profits, rent) usually uses personal allowance, basic rate and higher rate bands before savings income (interest). To the extent that savings income falls in the first £5,000 of the basic rate band, it is taxed at nil rather than 20%.

    The PSA will tax interest at nil, where it would otherwise be taxable at 20% or 40%.

    Dividends are normally taxed as the ‘top slice’ of income. The DNRB taxes the first £5,000 of dividend income at nil, rather than the rate that would otherwise apply.

    High Income Child Benefit Charge (HICBC)

    1% of child benefit for each £100 of adjusted net income between £50,000 and £60,000.

    Remittance basis charge2017/182016/17
    For non-UK domiciled individuals who have been 
    UK resident in at least
       
    7 of the preceding 9 tax years £30,000 £30,000
    12 of the preceding 14 tax years 60,000 60,000
    17 of the preceding 20 tax years N/A 90,000
logo
enquiries@rejonesandco.co.uk