A summary of key tax rates and allowances for 2021-22 and 2020-21.
Income Tax
Income Tax
|
Personal allowances |
2021-22 |
2020-21 |
| Personal allowance (PA) | £12,570 | £12,500 |
| PA restricted by £1 for every £2 of income over | £100,000 | £100,000 |
| Transferable tax allowance for certain married couples | £1,260 | £1,250 |
| Blind person's allowance | £2,520 | £2,500 |
| Married couples' allowance (at least one born pre 6 Apr 1935): Maximum (relief given at 10%) Minimum (relief given at 10%) |
£9,125 £3,530 |
£9,075 £3,510 |
|
Other allowances |
2021-22 |
2020-21 |
| Personal savings allowance: Basic rate Higher rate Top rate |
£1,000 £500 £0 |
£1,000 £500 £0 |
| Maximum savings starting rate (non-savings income < PA) Reduces by £1 for every £1 of non-savings income > PA |
£5,000 |
£5,000 |
| Dividends allowance | £2,000 | £2,000 |
| Rent-a-room allowance | £7,500 | £7,500 |
| Trading allowance | £1,000 | £1,000 |
| Property allowance | £1,000 | £1,000 |
|
2021-22 |
2020-21 |
|
| Basic rate band: Savings Non-savings Dividends Gift aid and pension contributions can extend basic rate band |
£37,700 20% 20% 7.5% |
£37,500 20% 20% 7.5% |
| Higher rate band: Savings Non-savings Dividends |
£37,701-£150,000 40% 40% 32.5% |
£37,501-£150,000 40% 40% 32.5% |
| Higher rate band: Savings Non-savings Dividends |
£150,000+ 45% 45% 38.1% |
£150,000+ 45% 45% 38.1% |
| Rates applicable to trusts: Savings Non-savings Dividends |
45% 45% 38.1% |
45% 45% 38.1% |
|
Non-domicile remittance basis charge (RBC) |
2021-22 |
2020-21 |
| De minimis unremitted foreign income and gains | £2,000 | £2,000 |
| UK resident 7 of last 9 tax years RBC | £30,000 | £30,000 |
| UK resident 12 of last 14 tax years RBC | £60,000 | £60,000 |
| UK resident 17 of last 20 tax years RBC | N/A | N/A |
| UK resident 15 of last 20 tax years RBC | Deemed domiciled | Deemed domiciled |
|
Child benefit |
2021-22 |
2020-21 |
| One child (per week) | £21.15 | £21.05 |
| Additional children (per week) | £14.00 | £13.95 |
| Reduced by 1% for every £100 of income over | £50,000 | £50,000 |
| Child benefit fully repayable if income over | £60,000 | £60,000 |
Savings & investments
|
ISA |
2021-22 |
2020-21 |
| ISA annual limit (cash and shares combined) | £20,000 | £20,000 |
| Lifetime ISA annual limit | £4,000 | £4,000 |
| Lifetime ISA withdrawal charge | 20% | 20% |
| Help to buy ISA limit per month, initial month extra £1,000 | £200 | £200 |
| Junior ISA annual limit | £9,000 | £9,000 |
|
Venture capital |
2021-22 |
2020-21 |
|
Maximum individual investment: |
£1,000,000 £2,000,000 £100,000 £200,000 £1,000,000 |
£1,000,000 £2,000,000 £100,000 £200,000 £1,000,000 |
| Maximum income tax reduction: EIS SEIS VCT SITR test |
30% 50% 30% 30% |
30% 50% 30% 30% |
|
Pensions |
2021-22 |
2020-21 |
| Lifetime allowance Excess taxed at: 55% for cash drawn 25% for income drawn |
£1,073,100 |
£1,073,100 |
| Annual allowance maximum | £40,000 | £40,000 |
| Annual allowance minimum | £4,000 | £4,000 |
| Maximum tax-relieved contributions with no relevant earnings | £3,600 | £3,600 |
| Money purchase annual allowance | £4,000 | £4,000 |
CGT
|
Exemptions |
2021-22 |
2020-21 |
| Annual exemption for individuals | £12,300 | £12,300 |
| Annual exemption for trusts generally | £6,150 | £6,150 |
| Chattels max gain 5/3rds x proceeds less exempt amount of... | £6,000 | £6,000 |
|
Rates |
2021-22 |
2020-21 |
| Individuals: Basic rate Above basic rate Additional surcharge applicable to residential property gains |
10% 20% 8% |
10% 20% 8% |
| Trusts Additional surcharge applicable to residential property gains |
20% 8% |
20% 8% |
| Companies | See corporation tax | |
|
Reliefs |
2021-22 |
2020-21 |
| Business Asset Disposal Relief - qualifying lifetime limit | £1,000,000 | £1,000,000 (from 11/3/2020) |
| Investors' Relief - qualifying lifetime limit | £10,000,000 | £10,000,000 |
| Both reliefs result in CGT at 10% on qualifying gains | ||
IHT
|
Exemptions and nil rates |
2021-22 |
2020-21 |
| Nil rate band | £325,000 | £325,000 |
| Residence nil rate band | £175,000 | £175,000 |
| Maximum at nil rate including nil rate band transfers from spouse | £1,000,000 | £1,000,000 |
|
Rates |
2021-22 |
2020-21 |
| Chargeable lifetime transfers | 20% | 20% |
| Transfers on, or within seven years of, death (excess over nil rate band) | 40% | 40% |
| Transfers on death, where 10% or more left to charity | 36% | 36% |
| Taper relief on IHT payable for gifts made within seven years of death |
0 - <3 years 3 - <4 years 4 - <5 years 5 - <6years 6 - <7 years More than 7 years |
0% 20% 40% 60% 80% Exempt |
|
Exemptions |
2021-22 |
2020-21 |
| Gifts to UK domiciled spouse (or non-dom with domicile election) | Unlimited | Unlimited |
| Gifts to non-domiciled spouse (additional to nil rate band) | £325,000 | £325,000 |
| Annual exemption (per donor): can be carried forward one year | £3,000 | £3,000 |
| Small gifts exemption (per donee) | £250 | £250 |
| Wedding gift from parent | £5,000 | £5,000 |
| Wedding gift from grandparent | £2,500 | £2,500 |
| Wedding gift from others | £1,000 | £1,000 |
| Regular gifts out of income | Unlimited | Unlimited |
| Business property relief: Controlling interest in listed company Personal assets used by partnership or company you control Interest in a trading business Shares in an unquoted trading company (including AIM-listed) |
50% relief 50% relief 100% relief 100% relief |
50% relief 50% relief 100% relief 100% relief |
| Agricultural property relief (applicable to agricultural value) | 100% relief | 100% relief |
VAT
|
VAT |
2021-22 |
2020-21 |
| Registration threshold (taxable turnover, i.e. excl. exempt) | £85,000 | £85,000 |
| Deregistration threshold | £83,000 | £83,000 |
| Rates: Standard Reduced Zero |
20% 5% 0% |
20% 5% 0% |
| Fractions: Standard Reduced |
1 / 6 1 / 21 |
1 / 6 1 / 21 |
| Cash accounting & annual accounting: Taxable turnover upper limit for joining Taxable turnover upper limit for leaving |
£1,350,000 £1,600,000 |
£1,350,000 £1,600,000 |
| Flat rate scheme: Taxable turnover upper limit for joining Anniversary test: leave if total income (incl. exempt) greater than stay if total income in next 12 months will be less than |
£150,000 £230,000 £191,500 |
£150,000 £230,000 £191,500 |
|
Flat rate scheme limited cost trader (LCT): LCT applies if spend on relevant goods in the quarter is: |
2% £250 16.5% |
2% £250 16.5% |
|
Partial exemption de-minimis: Recover VAT if input VAT attributable to exempt supplies is: |
£625 per month 50% |
£625 per month 50% |
Stamp Duties & ATED
|
Stamp Duty |
2021-22 |
2020-21 |
| Newly issued shares | 0% | 0% |
| Stocks and marketable securities with consideration over £1,000 | 0.5% | 0.5% |
|
2021-22 |
2020-21 |
|
|
First time buyers where cost of property < £500,000: £0 - £300,000 £300,000 - £500,000 If the cost is more than £500,000 then the normal rates apply. |
0% 5% |
0% 5% |
| £0 - £125,000 | 0% | 0% |
| £125,001 - £250,000 | 2% | 2% |
| £250,001 - £925,000 | 5% | 5% |
| £925,001 - £1,500,000 | 10% | 10% |
| £1,500,001 + | 12% | 12% |
| Note: owing to Coronavirus, the nil rate of SDLT is extended to £500,000 from 8 July 2020 to 30 June 2021. The nil rate will then fall to £250,000 until 30 September 2021 before returning to £125,000 as above. | ||
| Supplement for second home/buy to let and companies Not applicable if consideration less than |
3% £40,000 |
3% £40,000 |
| Higher rate for non-natural person with non-qualifying activity (applies to companies, partnerships with a company partner and collective investment schemes) |
15% if >£500,000 |
15% if >£500,000 |
| Surcharge for non-UK residents | 2% | N/A |
|
Stamp Duty Land Tax - non-residential or mixed property |
2021-22 |
2020-21 |
| £0 - £150,000 | 0% | 0% |
| £150,001 - £250,000 | 2% | 2% |
| £250,001 + | 5% | 5% |
|
Annual Tax on Enveloped Dwellings |
2021-22 |
2020-21 |
| Applies if market value on valuation date exceeds | £500,000 | £500,000 |
| Valuation dates | 1 April 2017 | 1 April 2017 |
| Annual charge if taxable value is £500,001 - £1,000,000 | £3,700 | £3,700 |
| £1,000,001 - £2,000,000 | £7,500 | £7,500 |
| £2,000,001 - £5,000,000 | £25,300 | £25,200 |
| £5,000,001 - £10,000,000 | £59,100 | £58,850 |
| £10,000,001 - £20,000,000 | £118,600 | £118,050 |
| £20,000,001 + | £237,400 | £236,250 |
Corporation Tax & Capital Allowances
|
Corporation Tax |
2021-22 |
2020-21 |
| Rate | 19% | 19% |
| S455 tax on loans to participators | 32.5% | 32.5% |
|
Patent box and R&D |
2021-22 |
2020-21 |
| Patent box effective rate | 10% | 10% |
| Research and development (R&D) capital expenditure relief | 100% | 100% |
| R&D total enhanced deduction for SMEs | 230% | 230% |
| R&D tax credit rate on surrendable loss for SMEs | 14.5% | 14.5% |
| R&D large company above the line credit | 13% | 13% |
|
Capital allowances |
2021-22 |
2020-21 |
| Annual Investment Allowance (100%) up to | £1,000,000 to 31 December 2021, then £200,000 | £1,000,000 |
| Super deduction (expenditure between 1 April 2021 and 31 March 2023) | 130% | N/A |
| Super deduction (special rate assets) | 50% | N/A |
| Plant and machinery general pool writing down allowance (WDA) | 18% | 18% |
| Integral features and certain long-life assets WDA | 6% | 6% |
| Small pool WDA where balance <£1,000 | 100% | 100% |
| FYA for electric charge-points | 100% | 100% |
| Structures and buildings allowance (SBA) | 3% | 3% |
|
Capital allowance - cars |
2021-22 |
2020-21 |
| New and unused with CO2 emissions of 0g/km | 100% | 100% |
| New and unused with CO2 emissions of up to 50g/km | 18% | 100% |
| New and second hand up to 110g/km | 6% | 18% |
| New and second hand above 110g/km | 6% | 6% |
| Include cars used by sole traders or partnerships with private use in a single asset pool | ||
National Insurance
National Insurance Contributions
Class 1 (Employers & Employees)
|
2021-22 |
2020-21 |
|||
| Employee | Employer | Employee | Employer | |
| Main NIC rate | 12% | 13.8% | 12% | 13.8% |
| No NIC on first | £184 pw | £170 pw | £183 pw | £169 pw |
| Main rate charged up to | £967 pw | No limit | £962 pw | No limit |
| 2% on earnings above | £967 pw | N/A | £962 | N/A |
| Employment allowance per business* | N/A | £4,000 | N/A | £4,000 |
* Certain businesses do not qualify e.g. sole director companies and employers with an employer’s Class 1 NIC liability of £100,000 or more.
Self-employed (TBA for 2021/22)
| 2021-22 | 2020-21 | |
| Class 2 (Self employed) | ||
| Flat rate per week | £3.05 | £3.05 |
| Small profits threshold | £6,515 | £6,475 |
| Class 3 (Voluntary) | ||
| Flat rate per week | £15.40 | £15.30 |
| Class 4 (Self employed) | ||
| On profits £9,568 to £50,270 | 9.0% | 9.0% |
| On profits over £50,270 | 2.0% | 2.0% |