Income Tax
2017-18 2016-17 † £33,500 £32,000 *0% *0% 20% 20% **7.5% **7.5% † £33,500 £32,000 40% 40% **32.5% **32.5% £150,000 £150,000 45% 45% **38.1% **38.1%
Basic rate band – income up to Starting rate for savings income
Basic rate
Dividend ordinary rate Higher rate – income over
Higher rate
Dividend upper rate
Additional rate – income over
Additional rate
Dividend additional rate
Starting rate limit (savings income)
*£5,000
*£5,000
Pension Contributions There is no financial limit on the amount that may be contributed to a registered pension scheme. The maximum amount on which an individual can claim tax relief in any tax year is the greater of the individual’s UK relevant earnings or £3,600 (gross). If total pension input exceeds the annual allowance (£40,000) there may be a tax charge on the excess. The annual allowance may be reduced by £1 for every £2 of adjusted income over £150,000 to a minimum of £10,000. Maximum age for tax relief 74 Minimum age for taking benefits 55 Lifetime allowance charge – lump sum paid 55% – monies retained 25% on cumulative benefits exceeding £1 million* Maximum tax-free lump sum 25%* *Subject to transitional protection for excess amount. *Allowances are reduced by £1 for every £2 that adjusted net income exceeds £28,000 (£27,700) to a minimum MCA of £3,260 (£3,220). Where adjusted net income exceeds £100,000, PA is reduced in the same way until it is nil regardless of the individual’s date of birth. Tax Shelters Venture Capital Trust up to £200,000 £200,000 Enterprise Investment Scheme up to £1,000,000 £1,000,000 Seed Enterprise Investment Scheme up to £100,000 £100,000 Social Investment Tax Relief £1,000,000 £1,000,000 Tax-Free Savings Accounts for 2017-18 ISA subscription limit £20,000; Junior ISA and CTF subscription limit £4,128. † For Scottish taxpayers only the limit is £31,500. *If an individual’s taxable non-savings income exceeds starting rate limit, then starting rate limit for savings will not be available for savings income. £1,000 of savings income for basic rate taxpayers (£500 higher rate) may be tax-free. **The first £5,000 of dividends are tax-free. Personal allowance (PA) £11,500 £11,000 Married couple’s allowance (MCA) (relief 10%) Either partner born before 6 April 1935 *£8,445 *£8,355 Transferable Tax Allowance for certain married couples (relief 20%) £1,150 £1,100
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