| Rates | 2020/21 | 2019/20 |
| Personal allowance | £12,500 | £12,500 |
| Income limit | £100,000 | £100,000 |
| Transferable marriage allowance | £1,250 | £1,250 |
| Married couple’s allowance (relief at 10%) | ||
| Either partner born before 6.4.1935 | £9,075 | £8,915 |
| Income limit | £30,200 | £29,600 |
| Minimum where income exceeds limit | £3,510 | £3,450 |
| Blind person’s allowance | £2,500 | £2,450 |
| Dividend allowance | £2,000 | £2,000 |
| Personal savings allowance | ||
| Basic rate taxpayers | £1,000 | £1,000 |
| Higher rate taxpayers | £500 | £500 |
Income tax rates
| Taxable income | 2020/21 | 2019/20 | Rate % | Dividend rate % |
| £0 – £37,500 | £0 – £37,500 | 20 | 7.5 | |
| £37,501 – £150,000 | £37,501 – £150,000 | 40 | 32.5 | |
| Over £150,000 | Over £150,000 | 45 | 38.1 | |
| Scottish taxpayers (non-savings, non-dividend income only) | ||||
| Taxable income | 2020/21 | 2019/20 | Rate % | |
| £0 - £2,085 | £0 - £2,049 | 19 | ||
| £2,085 - £12,658 | £2,049 - £12,444 | 20 | ||
| £12,658 - £30,930 | £12,444 - £30,930 | 21 | ||
| £30,930 - £150,000 | £30,930 - £150,000 | 41 | ||
| Over £150,000 | Over £150,000 | 46 | ||
Welsh taxpayers. For 2020/21 and 2019/20, the Welsh rates and bands are the same as for the rest of the UK (except Scotland).
A 0% starting rate for savings income only applies to the extent that such income falls within the first £5,000 of taxable income. If taxable non-savings income exceeds the limit, the starting rate does not apply. A 0% rate applies to savings income falling within the personal savings allowance. Income taxable at the starting rate for savings does not fall within the personal savings allowance.
A 0% rate applies to dividend income within the dividend allowance.
The trust rate of income tax is 45%. The dividend trust rate is 38.1%.
National Insurance Contributions
| Class 1 (Earnings related) | 2020/21 |
| Employees | |
| Weekly earnings | |
| First £183 | Nil |
| £183.01 – £962 | 12% |
| Over £962 | 2% |
| Employers | |
| Weekly earnings | |
| First £169 | Nil |
| Over £169 | 13.8% |
Employees’ rates are reduced to 5.85% for married women with valid certificates of election but the 2% rate above £962 still applies. Rates are nil for employees over state pensionable age. Normal employers’ contributions are still payable. Employers’ rates for employees under 21 and apprentices under 25 are nil on earnings up to £962 per week.
Employment allowance
(per employer) – £4,000 a year.
Available only where the employer’s NIC liability for the previous tax year was less than £100,000.
Class 1A and Class 1B – 13.8%
Class 2 (Self-employed) – Flat rate £3.05 a week.
Small profits threshold £6,475 a year.
Class 3 (Voluntary contributions) – £15.30 a week.
Class 4 (Self-employed) – 9% of profits between £9,500
and £50,000 a year. 2% of profits above £50,000 a year.
Inheritance Tax
| 2020/21 | 2019/20 | |
| Nil-rate band | £325,000 | £325,000 |
| Residence nil-rate band | £175,000 | £150,000 |
| Rate of tax on excess | 40% | 40% |
| Chargeable lifetime transfers | 20% | 20% |
| Annual gifts of up to £3,000 per donor are exempt. | ||
Capital Gains Tax
| Annual exempt amounts 2020/21 | Rates |
| Individuals, disabled trusts, personal representatives | |
| for year of death and two years thereafter | £12,300 |
| Trusts generally | £6,150 |
| Rates 2020/21 | |
| Individuals: Standard rate | 10% |
| Higher rate | 20% |
| Trustees and personal representatives | 20% |
| Gains on residential property and carried interest | 18% / 28% |
| Gains to which entrepreneurs’ relief applies | 10% |
| Gains to which investors’ relief applies | 10% |
Individual Savings Accounts
| Limits | 2020/21 | 2019/20 |
| Annual limit | £20,000 | £20,000 |
| Junior ISA annual limit | £9,000 | £4,368 |
| Lifetime ISA annual limit | £4,000 | £4,000 |
| Help to Buy ISA monthly limit | £200 | £200 |
Tax-Free Mileage Allowances
| Employee’s own vehicle | |
| Motorcars and vans | 2020/21 |
| Up to 10,000 business miles | 45p |
| Over 10,000 business miles | 25p |
| Each passenger making same trip | 5p |
| Motorcycles | 24p |
| Cycles | 20p |
| Advisory fuel rates for company car from 1 March 2020 | |||
| Cylinder capacity | Petrol | Diesel | LPG |
| 0-1,400 cc | 12p | - | 8p |
| 0-1,600 cc | - | 9p | - |
| 1,401 cc - 2,000 cc | 14p | - | 10p |
| 1,601 cc - 2,000 cc | - | 11p | - |
| Over 2,000 cc | 20p | 13p | 14p |
Fixed Rate Deductions:
Unincorporated Businesses
| Vehicle expenditure | Amount per mile |
| Motorcars and goods vehicles | |
| Up to 10,000 business miles | 45p |
| Over 10,000 business miles | 25p |
| Motorcycles | 24p |
| Business use of home Hours worked per month | Amount per month |
| 25 or more | £10 |
| 51 or more | £18 |
| 101 or more | £26 |
| Private use of business premises | Disallowable |
| Number of occupants | amount per month |
| 1 | £350 |
| 2 | £500 |
| 3 or more | £650 |
