2010/2011 Tax Rates and Allowances

Income tax				Capital Gains Tax				Vehicle Benefits
	2010/11	2009/10			2010/11	2009/10		Chargeable on employees and directors earning £8,500 or over (including benefits)
Starting rate 10% (for savings income only)	£2,440	£2,440		Individual Exemption	£10,100	£10,100
Basic rate 20%	£37,400	£37,400		Chattels Exemption	£6,000	£6,000		Car Benefit: This is calculated as a percentage of the original list price of the vehicle.
Higher rate 40%	£37,401- £150,000	£37,400+		Trusts exemption	£5,050	£5,050
Additional Higher rate 50%	£150,001+	N/A		Rate of charge Pre 22/06/2010		18%		Car fuel benefit:This is now calculated as a percentage of a fixed sum of £18,000.
Savings income rate		20%		Post 22/06/2010 - Basic rate taxpayer 18% Higher Rate taxpayer - 28%
Personal Allowances				Entrepreneurs relief - 10% effective tax rate on the first £5,000,000 of relevant business assets gain (£2,000,000 prior to 23rd June 2010)				The percentage used for both the car benefit and car fuel benefit will be dependent on the level of CO2 vehicle emissions
	2010/11	2009/10		Transfers between husband and wife living together are exempt.
Under 65  Tax	£6,475	£6,475		Corporation Tax				Van benefit per vehicle:£3,000 if there is any private use.  Travel between home and work is no longer considered private use
65 -74	£9,490	£9,490		Years commencing		1st April 2009 & 2010
75 & over	£9,640	£9,640			Profits			Van Fuel Benefit: £550
				Small Co. rate	£0- £300,000	21%		Mileage Allowances
Pensions				Marginal rate	£300,001- £1,500,000	29.75%		The maximum tax-free mileage allowances for employees using their own cars for business are as follows:
Annual allowance capped at:	£255,000			Main rate	£1,501,001+	28%
Amounts exceeding annual allowance taxed at 40% (May be amended to incorporate 50% rate)				NB: Associated companies reduce band levels				2008/09 & 2009/10	First 10,000 Miles	10,000+ miles
				Main Capital Allowances				Car & Van	40p	25p
Tax relief given on:				Annual Investment Allowance(AIA) - 100% on the first £100,000 of expenditure (excluding cars) from 1st April 2010				Motorcycle	24p	24p
-100% of net relevant earnings or £3,600 if higher  - Relief restricted to basic rate on a tapered basis when earnings are between £150,000 and £180,000   - Basic rate relief only if earnings exceed £180,000				Existing Motor Cars- 25% of reducing balance.  Max of £3,000 per car				Bicycle	20p	20p
				New Cars - 10% reducing balance if CO2 exceeds 160g/km, 20% if below this				Notes:
Lifetime limit	£1,800,000			Plant & Machinery*  -20% of reducing balance				1. 'Payments in excess of approved rates- excess is taxable
Amounts exceeding lifetime limit taxed at 55% if extracted as a lump sum or 25% if not				Industrial Buildings- Effective rate 2% of cost				2. Payments at less than approved rates- employees can claim tax relief for shortfall.
Inheritance Tax				Computer Equipment*  - 20% of reducing balance
				Goodwill - 4% amortisation
Exempt transfers:				Integral features - 10%				NI Contributions
Gifts to UK domiciled spouse									2010/11
Gifts to charity								Class 1	Employer	Employee
Overseas domiciled spouse up to £55,000				* There will no longer be separate pools - all assets will go into the 'General (20%)' or the 'Integral Features (10%)' Pool, except cars where there is private use				Weekly earnings	% of all earnings
Annual exemption £3,000				Value Added Tax				£0- £110	NIL	NIL
Small gifts £250				Standard Rate				£110- £844	12.80%	11%
Wedding gifts - £5000 child, £2500 grandchild or remoter issue, £1000 other				From 4th January 2011		20%		Over £844	12.80%	1%
				From 1st January 2010		17.50%
Non UK assets held by a non domiciled individual				Up to 31st December 2009		15%
				VAT fraction	(From 1/1/10)	7/47		The above rates apply to those not contracted out of SERPS.
					(To 31/12/09)	3/23
				Registration- Turnover greater than £70,000
Rate of tax at death		40%		De-Registration- Turnover less than £68,000
Nil rate band:  £325,000 (09/10 also £325,000)				Cash accounting scheme				Class 1A	Employer	12.80%
				Register whilst turnover less than £1.35 million				Class 2*	S/Employed	£2.40 per wk
Lifetime tax rate		20%		De-register when turnover greater than £1.6 million				Class 3	Voluntary	12.05 per wk
								Class 4	S/Employed
No tax on transfers to individuals unless death within 7 years				Annual Accounting scheme - turnover less than £1.35 million
									£0-£5,715	0%
Reduced tax charge on gifts made when death is within 7 years				Flat rate scheme limit: £150,000				£5,715- £43,875		8%
				VAT Scale Charge:  Now based upon the CO2 Emissions of the vehicle concerned					Over £43,875	1%
Years:         0-3    3-4   4-5    5-6    6-7								* Payable if net earnings over £5,075 (09/10 £5,075)
% taxable    100    80     60     40     20

A4G Business, Tax and Financial Solutions is a trading name of A4G Accounting LLP. Company number OC320365. Regulated for a range of investment business activities by the Institute of Chartered Accountants in England and Wales. A list of members is available on request. Associate: stephen-hill Limited, Chartered Accountants and registered Auditors.