8
Autumn Budget 2017
Income tax and personal savings Income tax
2018/19
2017/18
Basic rate band – income up to
† £34,500
† £33,500
Starting rate for savings income
*0%
*0%
Basic rate
20%
20%
Dividend ordinary rate
**7.5%
**7.5%
Higher rate – income between
† £34,501 - £150,000
† £33,501 - £150,000
Higher rate
40%
40%
Dividend upper rate
**32.5%
**32.5%
Additional rate – income over
£150,000
£150,000
Additional rate
45%
45%
Dividend additional rate
**38.1%
**38.1%
Starting rate limit (savings income) *£5,000 † For Scottish taxpayers only the limit for 2017/18 is £31,500. The Scottish government is set to introduce further changes to the income tax rates and bands for Scottish taxpayers for 2018/19. *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 tax-free dividend allowance is set to reduce from £5,000 to £2,000 from 6 April 2018. *£5,000
Personal allowances
2018/19
2017/18
£11,850
£11,500
Personal Allowance (PA)
Married couple’s allowance (MCA) (relief given at 10%) Either partner born before 6 April 1935
*£8,695
*£8,445
£1,185
£1,150
Transferable Tax Allowance ('Marriage Allowance') For certain married couples (relief given at 20%)
*Allowances are reduced by £1 for every £2 that adjusted net income exceeds £28,900 (2017/18 £28,000) to a minimum MCA of £3,360 (2017/18 £3,260). Where adjusted net income exceeds £100,000 (2017/18 £100,000), PA is reduced in the same way until it is nil regardless of the individual’s date of birth. Marriage Allowance: allowing claims on behalf of deceased partners The government will legislate to allow Marriage Allowance claims on behalf of deceased spouses and civil partners, and for the claim to be backdated for up to four years where the entitlement conditions are met. The changes will have effect on and after 29 November 2017.
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