| Download a Printable PDF of these figures |
| Income tax |
|
2008/09 |
2007/08 |
| Starting rate
10% (for savings income only in
08/09) |
£2,320 |
£2,230 |
| Basic rate 20% (22% in 07/08) |
£36,000 |
£34,600 |
| Higher rate 40% |
£36,000+ |
£34,600+ |
| Savings
income rate |
20% |
20% |
| Personal Allowances |
|
| |
2008/09 |
2007/08 |
| Under 65 Tax |
£5,435 |
£5,225 |
| 65 -75 |
£9,030 |
£7,550 |
| 75 & over |
£9,180 |
£7,690 |
|
| Pensions |
| Annual
allowance |
100% of net
relevant earnings or £3,600 if higher |
| Capped at |
£235,000 |
|
| Amounts exceeding
annual allowance taxed at 40% |
| Lifetime limit |
£1,650,000 |
|
| Amounts exceeding
lifetime limit taxed at 25% |
|
|
| Inheritance Tax |
| Exempt transfers: |
|
| Gifts to UK domiciled
spouse |
|
| Gifts to charity |
|
| Overseas domiciled spouse
up to £55,000 |
| Annual exemption £3,000 |
|
| Small gifts £250 |
|
| Wedding gifts - £5000
child, £2500 grandchild or remoter issue, £1000 other |
| Non UK assets held by
a non domiciled individual |
|
| Rate of tax at death |
40% |
|
| Nil rate band: £312,000 (07/08 £300,000) |
| Increases to £325,000 by
2009 |
| Lifetime tax rate |
|
20% |
|
| No
tax on transfers to individuals unless death within 7 years |
| Reduced tax
charge on gifts made when death is within 7 years |
| Years: 0-3 3-4 4-5 5-6 6-7 |
| % taxable 100 80 60 40 20 |
|
|
|
| Capital Gains Tax |
|
2008/09 |
2007/08 |
| Individual Exemption |
£9,200 |
£9,200 |
| Chattels Exemption |
£6,000 |
£6,000 |
| Trusts exemption |
£4,800 |
£4,600 |
| Rate of charge |
18% |
10-40% subject to taper relief |
| Taper Relief abolished from 6th April 2008 |
| Entrepreneurs
relief - 10% effective tax rate on the first £1,000,000 of relevant business
assets gain from 6th April 2008 |
| Transfers between
husband and wife living together are exempt. |
| Corporation Tax |
| Year commencing |
|
2008/09 |
|
Profits |
|
| Small Co. rate |
£0- £300,000 |
21% |
| Marginal rate |
£300,001- £1,500,000 |
29.75% |
| Main rate |
£1,501,000+ |
28% |
| NB: Associated
companies reduce band levels |
| Main Capital Allowances |
| Annual
Investment Allowance(AIA) - 100% on the first £50,000 of
expenditure (excluding cars) |
| Motor Cars- 25% of reducing balance |
| Max £3,000 pa per car |
|
| Plant &
Machinery -20% of
reducing balance |
| Industrial Buildings- 3% of cost |
| Computer
Equipment - 20% of
reducing balance |
|
| Goodwill - 4% amortisation |
|
| Intergral features - 10% |
|
| No longer any enhanced first year allowances available excepting 100% allowances available on energy-saving plant & machinery and low-polluting company cars with CO2 emissions of less than 110g/km |
|
| Value Added Tax |
| Standard Rate |
|
17.50% |
| VAT fraction |
|
7/47 |
| Registration- Turnover greater than £67,000 (2007/08 - £64,000) |
| De-Registration- Turnover less than £65,000 (2007/08 - £62,000) |
| Cash accounting scheme |
| Register whilst turnover
less than £660,000 |
| De-register when
turnover greater than £825,000 |
| Annual
Accounting scheme - turnover less than £1,350,000 |
| Flat rate scheme limit: £150,000 |
| VAT Scale Charge: Now based upon the CO2 Emissions of the vehicle concerned |
|
| Vehicle Benefits |
| Chargeable
on employees and directors earning £8,500 or over (including benefits) |
| Car
Benefit: This is calculated as a percentage of the
original list price of the vehicle. |
| Car
fuel benefit:This is now calculated as a percentage of a
fixed sum of £16,900. |
| The
percentage used for both the car benefit and car fuel benefit will be
dependent on the level of CO2 vehicle emissions |
| Van
benefit per vehicle:£3,000 if there is any private
use. Travel between home and work is
no longer considered private use |
| Van Fuel Benefit: £500 |
| Mileage Allowances |
| The maximum
tax-free mileage allowances for employees using their own cars for business
are as follows: |
| 2008/2009 |
First 10,000 Miles |
10,000+ miles |
| Car & Van |
40p |
25p |
| Motorcycle |
24p |
24p |
| Bicycle |
20p |
20p |
| Notes: 1.Payments in excess of approved rates- excess is taxable |
| 2.Payments
at less than approved rates- employees can claim tax relief for shortfall. |
| NI Contributions |
2008/2009 |
|
| Class 1 |
Employer |
Employee |
| Weekly earnings |
|
| % of all earnings |
|
| £0- £105 |
NIL |
NIL |
| £105- £770 |
12.80% |
11% |
| Over £770 |
12.80% |
1% |
| The above
rates apply to those not contracted out of SERPS. |
|
| Class 1A |
Employer |
12.80% |
| Class 2* |
S/Employed |
£2.30 per wk |
| Class 3 |
Voluntary |
£8.10 |
| Class 4 |
S/Employed |
|
£5,435- £40,040 |
8% |
Over
£40,040 |
1% |
| * Payable on
net earnings over £4,825 (07/08 £4,635) |
 |
|
