Income Tax |
|
|
2008-09 |
2007-08 |
| Starting rate band |
|
*£2,320 |
£2,230 |
| Tax rate |
|
*10% |
10% |
| Basic rate band |
|
**£34,800 |
£32,370 |
|
Basic rate |
|
20% |
22% |
| Savings rate |
|
20% |
20% |
| Dividend ordinary rate |
|
10% |
10% |
| Higher rate - income over |
|
**£34,800 |
£34,600 |
| Higher rate tax |
|
40% |
40% |
| Dividend upper rate |
|
32.5% |
32.5% |
| * 10% starting rate only available for savings income up to £2,320. Not applicable if taxable non-savings income exceeds £2,320. |
|
|
|
| Allowances that Reduce Taxable Income |
|
|
|
| Personal Allowances (PA) |
- under 65 |
**£6,035 |
£5,225 |
|
- 65 to 74 |
£9,030 |
£7,550 |
|
- 75 and over |
£9,180 |
£7,690 |
| Allowances that Reduce Tax |
|
|
|
| Married couple's allowance (MCA) |
|
|
|
| Tax reduction |
- 74 |
£653.50 |
£628.50 |
|
- 75 and over |
£662.50 |
£636.50 |
| Ages are as at the end of the tax year |
|
|
|
| The age-related allowances are progressively withdrawn if income exceeds |
|
£21,800 |
£20,900 |
| Minimum PA |
|
**£6,035 |
£5,225 |
| Minimum MCA tax reduction |
|
£254 |
£244 |
| Tax Shelters |
|
|
|
| Enterprise Investment Scheme up to |
|
^£500,000 |
£400,000 |
| Venture Capital Trust up to |
|
£200,000 |
£200,000 |
| 'Rent a Room' exempt on gross annual rent |
|
£4,250 |
£4,250 |
| Construction Industry Scheme deduction rate |
|
20/30% |
20/30% |
|
** Based on Finance Act revisions to original Budget announce
^ Start date subject to European Commission approval |
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