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Tax Thresholds and Benefits

Tax Thresholds and Benefits 2019

Here’s our handy guide to the tax thresholds and benefits for the tax year 2019/20. You can download a copy by following this link

Income tax, personal and married allowances

£ per year (unless stated) 2019-20 2018-2019 Change
Personal allowance (age under 65)* 12,500 11,850 650
Dividend Allowance** 2,000 2,000 nil
Marriage Allowance 1,250 1,190 60
Marriage Couples Allowance 8915 8695 220
Minimum amount 3,450 3,360 90
income limit 29,600 28,900 700
Blind Persons allowance 2,450 2,390 60
Basic rate limit (@20%; 7.5% dividend income)*** 37,500 34,500 3000
Higher rate limit (@40%; 32.5% dividend income) 150,000 150,000 nil
Additional rate (@45%; 38.1% dividend income) Over  150,000 Over 150,000 nil

*Withdrawn at a rate of £1 of allowance for every £2 of income over £100,000

**The dividend allowance and personal savings allowance utilise the basic and higher rate bands.

Certain trusts taxed at 45% (38.1% on dividend income)

***Savings income of up to £5,000 taxable at 0% in certain circumstances

National Insurance contributions (Employees rates)

£ per year (unless stated) 2019-20 2018-19 Change
Class 1 Earnings threshold (Primary) (nil rate) 166 162 4
Class 1 Upper earnings threshold (12% rate) 962 892 70
Class 4 lower profits limit (£ per year) 8,632 8,424 208
Class 4 upper profits limit (£ per year) (9%) 50,000 46,350 3650

National Insurance contributions (Employers rates)

£ per year (unless stated) 2019-20 2018-19 Change
Class 1 Earnings threshold (Primary) (nil rate) 166 162 4
Class 1 Upper earnings threshold (13.8 % rate)* Over 166 Over 162 4
Annual allowance for most employers 3,000 3,000 nil

*Special rules for employees under 21years old, or apprentices under 25years old.

Class 1A Employer: 13.8% on most benefits in kind not within Class 1

Class 2 Self Employed: Flat rate £3.00 pw (if earnings exceed £6,365

Class 3 Voluntary: Flat rate £15.00 pw.

Class 4 Self-employed: 9% on annual profits between £8632 and £50,000, 2% on annual profits above £50,000

Capital gains tax

£ per year (unless stated) 2019-20 2018-19 Change
Annual exemption (Individuals and personal representatives) 12,000 11,700 300
Annual exemption (trustees) 6,000 5,850 150
Basic rate taxpayers* 10% 10% nil
Higher rate taxpayers** 20% 20% nil
Trustees** 20% 20% nil
Entrepreneurs’ relief- (10%) lifetime limit on or after Apr 6 2019 10,000,000 10,000,000 nil

*A rate of 18% applies to chargeable gains accruing on the disposal of residential property and certain other assets

**A rate of 28% applies to chargeable gains accruing on the disposal of residential property and certain other assets

Corporation Tax

£ per year (unless stated) FY2019 FY2018 Change
Taxable Profits 19% 19% nil

*For FY2020 the rate will be 17%

Inheritance tax threshold

£ per year (unless stated) 2019-20 2018-19 Change
Nil band rate 325,000 325,000 nil
40% band rate Above 325,000 Above 325,000 nil

Tax efficient investments

£ per year (unless stated) 2019-20 2018-19 Change
Seed Enterprise investment scheme* 100,000@50% 100,000@50% nil
Enterprise investment scheme * (monthly income tax relief) 1,000,000@30% 1,000,000@30% nil
Venture capital trusts* (maximum income after tax relief) 200,000@30% 200,000@30% nil

*CGT relief available in some circumstances

Individual Savings Account (ISA)

£ per year (unless stated) 2019-20 2018-19 Change
Overall investment limit (maximum) 20,000 20,000 nil
Junior ISA (maximum, under 18’s) 4,368 4,260 108

*Investment limited to one cash ISA, one stocks and shares ISA, or one of each up to the maximum overall limits in any one tax year

Benefits

£ per week (unless stated) 2019-20 2018-19 Change
State pension          Category A or B basic pension* 129.20 N/A N/A
                               Category B pension (lower) – husband’s insurance** 77.45 N/A N/A
                               Category C or D – non contributory*** 77.45 N/A N/A
Pension credit         Single (standard minimum guarantee) 167.25 N/A N/A
                               Couple 255.25 N/A N/A
Child Benefit           First 20.70 20.70 nil
                               Other 13.70 13.70 nil
Child tax credit       Family element (£ per year) 545 545 nil
                               Child element (£ per year) 2,780 2,780 nil

*Based on own/late husband’s, wife’s or civil partner’s national insurance contributions

**Based on husband’s national insurance contributions

***Non-contributory over 80’s pension

Stamp duty land tax

Rate (%) Residential 2019-20 2018-19 Change
£0-£125,000 0% 0% nil
£125,001-£250,000 2% 2% nil
£250,001-£925,000 5% 5% nil
£925,001-£1,000,000 10% 10% nil
Over £1,500,000 12% 12% nil

*First time buyer relief may apply to residential purchases up to £500,000

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