Income tax

Tax bands and rates 2014/15 2013/14
Basic rate band £31,865 £32,010
Basic tax rate 20% 20%
Dividend ordinary tax rate 10% 10%
Savings rate band £2,880 £2,790
Savings rate 10% 10%
Higher rate band £31,866 - £150,000 £32,011 - £150,000
Higher tax rate 40% 40%
Dividend higher tax rate 32.5% 32.5%
Additional rate band over £150,000  £150,000
Additional tax rate 45% 45%
Dividend additional tax rate 37.5% 37.5%
Allowances that reduce taxable income
Personal allowances Those born after 5 April 1948 £10,000 £9,440
  Those born after 5 April 1938 and before 6 April 1948 £10,500 £10,500
  Those born before 6 April 1938  £10,660 £10,660
Blind person's allowance   £2,230 £2,160

Age related allowances are reduced by £1 for each £2 of income above £27,000 (2013/14 £26,100), until the minimum of £10,000 (2013/14 £9,440) is reached.

The minimum personal allowance is reduced by £1 for each £2 of income from £100,000 to £120,000 (2013/14 - £118,880).

Allowances that reduce tax
Married couple's allowance (MCA) Maximum amount £8,165 £7,915
Tax reduction at 10% £816.50 £791.50
Non domicile charge
Charge for adult non UK domiciliary - applies after UK residence in seven or
more of the previous nine tax years
£30,000 £50,000
Investment tax shelters    

Enterprise Investment Scheme (EIS) up to

£1,000,000 £1,000,000
Maximum amount for EIS carry back £50,000 £50,000
Income tax relief rate 30% 30%
Seed Enterprise Investment Scheme (SEIS) £100,000 £100,000
Income tax relief  50%  50%
Venture Capital Trust £200,000 £200,000
VCT tax relief rate 30% 30%
Golden handshake maximum tax free £30,000 £30,000
Rent a room - exempt on gross annual rent up to £4,250 £4,250
Construction industry scheme - deduction rate    
Standard rate - registered 20% 20%
Higher rate - not registered 30% 30%

Did you know?

That the Treasury is expecting to raise £163.8 billion from income tax (2013/14 - £152.9 billion).