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We have summarised the key rates and allowances which are fundamental to our business and personal lives. We are sure that you will find them a useful point of reference and have set out below a few examples of how they can be used.

Personal tax rates

As the UK tax system becomes more devolved, it is important to keep abreast of the changes taking place in the Scottish and Welsh income tax rates and bands. We have summarised the relevant information together with the rates and allowances which apply to investment income.

Buying property

If you buy property then property taxes payable are different depending where the property is in the United Kingdom. Stamp Duty Land Tax is payable on property in England and Northern Ireland, whilst Land and Buildings Transaction Tax is payable on property in Scotland and Land Transaction Tax on property in Wales. Our tax rates highlight the main rates so that you can consider the potential cost of buying property.

Business or asset sale

If you sell an asset such as shares or your business, capital gains tax may be due. Our tax rates highlight the main rates and reliefs so that you can consider the tax bill that may arise.

Rates for businesses

If you run a business, obtaining the right allowances on equipment that your business buys can affect the tax that your business has to pay each year. We have summarised the main allowances that are available.

Rates for employees

There are changes to the way company car benefits are calculated this year. Our guide explains how these are computed to help ensure that you are paying the correct amount of tax.

Rates that affect us all

Long term planning for a comfortable retirement can never start too early. Our tax rates explain how much can be contributed to an approved pension scheme each year tax efficiently.

Our tax rates contain the main inheritance tax rates and exemptions but early planning can mitigate these tremendously.

These rates are intended for use as a quick point of reference. Should you require any further information, have a simple question or require detailed advice we are only a phone call away.

Capital Allowances - Plant and Machinery

  • The cost of purchasing capital equipment in a business is not a revenue tax deductible expense. However, tax relief is available on certain capital expenditure in the form of capital allowances.
  • Plant and machinery allowances may be available on items such as machines, equipment, furniture, certain fixtures in a building ('integral features'), computers, cars, vans and similar equipment used in a business. 
  • There are special rules for cars.
  • Plant and machinery allowances may be available to owners of commercial property which is let out to a business.
  • The Annual Investment Allowance (AIA) gives a 100% write-off on most types of plant and machinery (but not cars) up to an annual limit.
  • Writing down allowances (WDA) are given for expenditure for which AIA is not, or cannot be, claimed.
  • A Structures and Buildings Allowance of 3% may be available for qualifying investments to construct new, or renovate old, non-residential structures and buildings.

AIA

  • Special rules apply to accounting periods straddling the dates shown in the tables below.
  • The AIA may need to be shared between certain businesses under common ownership.

AIA limits - companies

Expenditure incurred:

Annual limit

  £
From 1 January 2019 to 31 March 2023 1,000,000
From 1 April 2023 200,000

AIA limits - sole traders and partnerships

Expenditure incurred:

Annual limit

  £
From 1 January 2019 to 31 March 2023 1,000,000
From 1 April 2023 200,000

Other plant and machinery allowances

  • Expenditure upon which AIA is not given/claimed will obtain relief through the 'main rate pool' or the 'special rate pool' rather than each item being dealt with separately.
  • The annual rate of WDA is 18% in the 'main rate pool' and 6% in the 'special rate pool'. 
  • A 100% first year allowance (FYA) may be available on certain cars.
  • Between 1 April 2021 and 31 March 2023, companies investing in qualifying new plant and machinery will benefit from a new FYA. A company will be allowed to claim a super-deduction of 130% on certain new plant and machinery investments that ordinarily qualify for the 18% WDA and a 50% FYA on most new plant and machinery investments that ordinarily qualify for the 6% WDA.

Cars

  • For expenditure incurred on cars, costs are generally allocated to one of the two plant and machinery pools.
  • AIA is not available on any car but a 100% FYA may be available on certain cars. To qualify for FYA, the car must be purchased new.

Cars acquired from April 2021

Emissions (g/km)

Pool

Allowance

0 Main rate 100% FYA
≤ 50 Main rate 18% WDA
>50 Special rate 6% WDA

Capital gains tax (CGT)

  • CGT is payable by individuals, trustees and personal representatives (PRs). Companies pay corporation tax on their capital gains.
  • There are annual tax-free allowances (the 'annual exempt amount') for individuals, trustees and PRs. Companies do not have an annual exempt amount.
  • For individuals, net gains are added to total taxable income to determine the appropriate rate of tax. The standard rate applies only to the net gains which, when added to total taxable income, do not exceed the basic rate band.
  • Gains which qualify for Investors' Relief are charged at 10% for the first £10m of qualifying gains.
  • Gains which qualify for Business Asset Disposal Relief are charged at 10% for the first £1 million.

Rates and annual exemption

Individuals 2022/23
  £
Exemption 12,300
Standard rate 10%
Higher rate 20%

The higher rate applies to higher rate and additional rate taxpayers.

Gains accruing on the disposal of certain residential property and arising on carried interest can attract a standard rate of 18% or a higher rate of 28% for individuals and of 28% for Trusts and Personal Representatives.

Trusts 2022/23
  £
Exemption 6,150
Rate 20%

Car Benefits

  • The car benefit is calculated by multiplying the car's list price, when new, by a percentage linked to the car's CO2 emissions. 
  • For diesel cars generally add a 4% supplement (unless the car is registered on or after 1 September 2017 and meets the Euro 6d emissions standard).
  • The overall maximum percentage is capped at 37%.
  • The list price includes accessories.
  • The list price is reduced for capital contributions made by the employee up to £5,000.
  • Special rules may apply to cars provided for disabled employees.

2022/23

CO2 emissions
(g/km)

% of list price taxed

0

2

1–50 (split by zero-emission miles)

More than 130

70-129

40-69

30-39

Under 30




2

5

8

12

14

51–54

15

55-59

16

60-64

17

65-69

18

70-74

19

75-79

20

80-84

21

85-89

22

90-94

23

95-99

24

100-104

25

105-109

26

110-114

27

115-119

28

120-124

29

125-129

30

130-134

31

135-139

32

140-144

33

145-149

34

150-154

35

155-159

36

160 and above

37

Car fuel benefit

  • Car fuel benefit applies if an employee has the benefit of private fuel for a company car.
  • The benefit is calculated by applying the percentage used to calculate the car benefit by a 'fuel charge multiplier'.
  • The charge is proportionately reduced if provision of private fuel ceases part way through the year. The fuel benefit is reduced to nil only if the employee pays for all private fuel.
Car fuel benefit 2022/23  
Fuel charge multiplier £25,300

Cars - advisory fuel rates for company cars

  • Advisory rates only apply where employers reimburse employees for business travel in a company car or require employees to repay the cost of fuel used for private travel in a company car.
  • If the rate paid per mile of business travel is no higher than the advisory rate for the particular engine size and fuel type of the car, HMRC will accept that there is no taxable profit and no Class 1 NIC liability.

The advisory fuel rates for journeys undertaken on or after 1 March 2022 are:

Engine size Petrol
1400cc or less 13p
1401cc - 2000cc 15p
Over 2000cc 22p
Engine size Diesel
1600cc or less 11p
1601cc - 2000cc 13p
Over 2000cc 16p
Engine size LPG
1400cc or less 8p
1401cc - 2000cc 10p
Over 2000cc 15p

Hybrid cars are treated as either petrol or diesel cars for this purpose.

The Advisory Electricity Rate for fully electric cars is 5 pence per mile. Electricity is not a fuel for car fuel benefit purposes.

Child Benefit

Child Benefit is receivable by a person responsible for each child who is under 16, or under 20 if they stay in approved education or training.

If the person (or their spouse or partner) has 'adjusted net income' above £50,000 the person with the highest income has to pay some of the Child Benefit as a tax charge.

Where adjusted net income is more than £60,000 a year, the tax charge equals the Child Benefit received.

Rates - 2022/23 £ per week
Eldest/Only Child £21.80
Other Children £14.45

Corporation tax rates

  • Corporation tax rates are set for each Financial Year. A Financial Year runs from 1 April to the following 31 March.
  • If the accounting period of a company straddles the 31 March, the profits are apportioned on a time basis to each Financial Year.
  • The Northern Ireland Executive has committed to setting the rate of corporation tax at 12.5% to apply to certain trading income. While legislation has been passed, the final devolution is subject to agreement between the UK Government and the Northern Ireland Executive, which has not yet been reached.
Year to 31.3.23 Rate %
All profits 19

Employee's Statutory Payments

Statutory pay

  • Payments may be required from an employer if an employee is not at work for a variety of reasons.
  • There are detailed conditions for an employee to qualify for any of these statutory payments.
  • Employees are only eligible for a statutory payment if they have sufficient average weekly earnings of at least the lower earnings limit.

Statutory Sick Pay

  • Payments may be required from an employer if an employee is too ill to work.
  • SSP is generally payable for a period up to 28 weeks.

Statutory Maternity Pay

  • Payments may be required from an employer when an employee takes time off to have a baby.
  • SMP is payable for a period up to 39 weeks.

Statutory Paternity Pay

  • Payments may be required from an employer when an employee takes time off during their partner's Statutory Maternity Pay period.
  • Payment is for a period of either one or two complete weeks.

Shared Parental Pay

  • Payments may be required from an employer when an employee takes time off following the curtailment of the period of SMP by the mother.
  • Payment is for up to a maximum of 37 weeks and is dependent on the mother's unused SMP period.

Statutory Adoption Pay

  • Payments may be required from an employer when an employee takes time off when they adopt a child.
  • Payment is for a period up to 39 weeks.

Statutory Parental Bereavement Pay

  • Payments may be required from an employer when parents take time off following the death of a child or a stillbirth.
  • Payment is for up to a maximum of two weeks.
2022/23 Statutory pay rates -
average weekly earnings £123 or over
 
Statutory Sick Pay £99.35
Statutory Maternity Pay  
First six weeks 90% of weekly earnings
Next 33 weeks £156.66
Statutory Paternity Pay - two weeks £156.66
Statutory Adoption Pay - 39 weeks  
First six weeks 90% of weekly earnings
Next 33 weeks £156.66
Shared Parental Pay £156.66
Statutory Parental Bereavement Pay - two weeks £156.66

With the exception of Statutory Sick Pay, statutory payments may be payable at 90% average weekly earnings throughout the payment period in certain circumstances. This applies where 90% weekly earnings are less than the standard rate of £156.66.

Income tax allowances

A personal allowance gives an individual an annual amount of income free from income tax.

Income above the personal allowances is subject to income tax.

The personal allowance will be reduced if an individual's 'adjusted net income' is above £100,000. The allowance is reduced by £1 for every £2 of income above £100,000.

An individual born before 6 April 1935 may be entitled to a married couple's allowance but this is reduced if 'adjusted net income' is above the married couple's allowance income limit (see table below).

Marriage allowance - 10% of the personal allowance may be transferable between certain spouses where neither pays tax above the basic rate. The Marriage allowance is not available to couples entitled to the Married Couple's allowance.

Income tax personal allowances £
Personal Allowance 12,570
Marriage Allowance 1,260
Blind person's allowance 2,600

Married couple's allowance

Either partner born before 6 April 1935

 
- Maximum reduction in tax bill 941.50
- Minimum reduction in tax bill 364.00

Married couple's allowance income limit

Reduce married couple's allowance by £1 for every £2 of 'adjusted net income' above this limit

31,400

Income tax rates - across the UK

  • Income tax applies to the amount of income after deduction of personal allowances.
  • Income is taxed in a specific order with savings and dividend income taxed last.
  • Dividend income and savings income falling within the dividend and savings allowances still form part of total income of an individual.
  • There is also a starting rate band (SRB) of £5,000 which is only applicable to savings income. The band is not available if the taxable amount of non-savings income exceeds the SRB.
  • The Scottish Parliament set the rates of income tax and the limits at which these rates apply for Scottish residents on non-savings and non-dividend income.
  • Income tax is devolved to Wales on non-savings and non-dividend income.

Income tax rates

Band of taxable income Rate Rate if dividends
£   % %
0 - 37,700 Basic rate 20 8.75
37,701 - 150,000 Higher rate 40 33.75
Over 150,000 Additional rate 45 39.35
Special rates for savings and dividend income falling into above bands of taxable income
Savings Allowance
Basic rate taxpayers 1,000 0  
Higher rate taxpayers 500 0  
Additional rate taxpayers Nil N/A  
Dividend Allowance
for all taxpayers 2,000   0

Income tax rates - Scotland

  • Scottish resident taxpayers are liable on non-savings and non-dividend income as set out below.
  • Savings income and dividend income are taxed using UK tax rates and bands.
Band of taxable income Rate
£   %
0 - 2,162 Starter rate 19
2,163 - 13,118 Basic rate 20
13,119 - 31,092 Intermediate rate 21
31,093 - 150,000 Higher rate 41
Over 150,000 Top rate 46

Income tax rates - Wales

  • Income tax is devolved to Wales.
  • Welsh resident taxpayers continue to pay the same overall income tax rates using the UK rates and bands.
  • The total rate of income tax = UK income tax + Welsh rate of income tax
  • Savings income and dividend income are taxed using UK tax rates and bands.
Band of taxable income UK Rate Welsh Rate Total Rate
£   % % %
0 - 37,700 Basic rate 10 10 20
37,701 - 150,000 Higher rate 30 10 40
Over 150,000 Additional rate 35 10 45

Individual Savings Account (ISA)

The income from ISA investments is exempt from income tax. Any capital gains made on investments held in an ISA are exempt from capital gains tax.

Savers are able to subscribe any amounts into a cash ISA, a stocks and shares ISA or an innovative finance ISA subject to not exceeding the overall annual investment limit.

Investors may transfer their investments from one kind of ISA to another.

The Lifetime ISA is available for those aged between 18 and 40. Save up to £4,000 each year up until the age of 50, and receive a government bonus of 25% (a bonus of up to £1,000 a year). Savers can use some or all of the money to buy their first home, or keep it until they are aged 60 when the account can be accessed tax free. Conditions apply to the account holder and property purchased.  Penalties apply if funds are withdrawn in other circumstances.

A Help to Buy ISA provides a tax free savings account for first time buyers wishing to save for a home. The scheme provides a government bonus to each person who has saved into a Help to Buy ISA at the point they use their savings to purchase their first home. For every £200 a first time buyer saves, the government will provide a £50 bonus up to a maximum bonus of £3,000 on £12,000 of savings. The bonus will be paid in the form of a voucher when the first home is purchased. Conditions apply to the account holder and to the property purchased. Help to Buy ISAs closed to new savers on 30 November 2019. Existing holders can continue saving until 30 November 2029 and will have until 1 December 2030 to claim their bonus.

ISA limits 2022/23  
Overall annual investment limit £20,000
Junior ISA annual investment limit £9,000
Help to Buy ISA monthly subscription limit £200
Lifetime ISA annual investment limit £4,000

Inheritance tax (IHT)

  • IHT may be payable when an individual's estate is worth more than the IHT nil rate band when they die.
  • Lifetime and death transfers between UK domiciled spouses are exempt from IHT.
  • A further nil rate band of £175,000 may be available in relation to current or former residences.
  • The IHT threshold available on death may be increased for surviving spouses as there may have been a nil rate band not used, or not fully used, on the first death.
  • There are reliefs for some business and farming assets which reduce their value for IHT purposes.
  • IHT may also be payable on gifts made in an individual's lifetime but within seven years of death.
  • Some lifetime gifts are exempt.
  • Transfers of assets into trust made in an individual's lifetime may be subject to an immediate charge but at lifetime rates.
  • There are also charges on some trusts.

IHT rates and nil rate band 2022/23 and 2021/22

IHT nil rate £325,000
Lifetime rate 20%
Death rate 40%
Death rate if sufficient charitable legacies made 36%

IHT reliefs for lifetime gifts

Annual exemption £3,000
Small gifts £250
Marriage  
- parent £5,000
- grandparent £2,500
- other £1,000

IHT - reduced charge on gifts within seven years of death

Years before death % of death charge
0-3 100
3-4 80
4-5 60
5-6 40
6-7

20

Land and Buildings Transaction Tax

Land and Buildings Transaction Tax (LBTT) is payable on land and property transactions in Scotland.

LBTT (Residential property)

Consideration (£) Rate
0 - 145,000 0%
145,001 - 250,000 2%
250,001 - 325,000 5%
325,001 - 750,000 10%
750,001 and above 12%

The rates apply to the portion of the total value which falls within each band.

Residential rates may be increased by 4% where further residential properties, costing over £40,000, are acquired.

First-time Buyer relief raises the zero rate tax threshold for first-time buyers from £145,000 to £175,000.

LBTT (Non-residential)

Consideration (£) Rate
0 - 150,000 0%
150,001 - 250,000 1%
Over 250,000 5%

The rates apply to the portion of the total value which falls within each band.

Land Transaction Tax

Land Transaction Tax (LTT) is payable on land and property transactions in Wales.

LTT (Residential property)

Consideration (£) Rate
0 - 180,000 0%
180,001 - 250,000 3.5%
250,001 - 400,000 5%
400,001 - 750,000 7.5%
750,001 - 1,500,000 10%
1,500,000 and above 12%

The rates apply to the portion of the total value which falls within each band.

Residential rates may be increased by 4% where further residential properties costing over £40,000 or over are acquired.

Higher residential tax rates

Higher residential rates may apply when you already own one or more residential properties.

Consideration (£) Rate
0 - 180,000 4%
180,001 - 250,000 7.5%
250,001 - 400,000 9%
400,001 - 750,000 11.5%
750,001 - 1,500,000 14%
1,500,000 and above 16%

The rates apply to the portion of the total value which falls within each band.

LTT (Non-residential)

Consideration (£) Rate
0 - 225,000 0%
225,001 - 250,000 1%
250,001 - 1,000,000 5%
Over 1,000,000 6%

The rates apply to the portion of the total value which falls within each band.

Mileage Allowance Payments (MAPs) for employees

  • MAPs represent the maximum tax free mileage allowances an employee can receive from their employer for using their own vehicle for business journeys.
  • An employer is allowed to pay an employee a certain amount of MAPs each year without having to report payments to HMRC.
  • If the employee receives less than the statutory rate, tax relief can be claimed on the difference.

MAP rates per business mile 2022/23 and 2021/22

Cars and vans Rate per mile
Up to 10,000 miles 45p
Over 10,000 miles 25p
Bicycles 20p
Motorcycles 24p

Minimum Wage

  • National Minimum Wage rates apply to employees up to the age of 22.
  • National Living Wage (NLW) rates apply to employees 23 and over.
  • The Apprentice rate applies to apprentices under 19, or 19 and over in the first year of apprenticeship.
  • Penalties apply to employers who fail to pay minimum wages.
Age NLW 21-22 18-20 16-17

Apprentice

From 1 April 2022 £9.50 £9.18 £6.83 £4.81 £4.81

National Insurance contributions (NIC) - rates and allowances

  • Employees start paying Class 1 NIC from age 16 (if sufficient earnings).
  • Employers pay Class 1 NIC in accordance with the table below.
  • Employer NIC for employees under the age of 21 and apprentices under the age of 25 is reduced from the normal rate of 15.05% to 0% up to the Upper Secondary Threshold of £967 per week. Also applies to veterans in the first 12 months of employment.
  • Employees' Class 1 NIC stop when they reach their State Pension age. The employer's contribution continues.

Employees - Class 1 - 2022/23

Earnings per week %
Up to £190* Nil
£190.01 - £967 13.25
Over £967 3.25

* £242 from 6 July 2022

Entitlement to state pension and other contribution-based benefits is retained for earnings between £123 and £190* per week.

Employers - Class 1 - 2022/23

Earnings per week %
Up to £175 Nil
Over £175 15.05

Other National Insurance payable by employers

Class 1A - 15.05% on broadly all taxable benefits provided to employees and on certain taxable termination and sporting testimonial payments in excess of £30,000

Class 1B - 15.05% on taxable PAYE Settlement Agreements

Self-employed - Class 2 and 4

  • A self-employed person starts paying Class 2 and Class 4 NIC from 16 or over (if sufficient profits)
  • Class 2 NIC stop when a person reaches State Pension age
  • Class 4 NIC stop from the start of the tax year after the one in which the person reaches State Pension age.

Self-employed - Class 2 - 2022/23

Flat rate per week £3.15
Small Profits Threshold £6,725 per year
Lower Profits Limit £11,908

For 2022/23 the point at which the self-employed person starts to pay Class 2 NICs will increase to £11,908. This means those with profits between the Small Profits Threshold and the Lower Profits Limit will not pay Class 2 NICs, but will still be able to access entitlement to contributory benefits.  A self-employed person with profits below the Small Profits Threshold might decide to carry on paying Class 2 voluntarily to accrue entitlement to the State Pension and other benefits.

Class 4 - 2022/23

Annual profits %
Up to £11,908 Nil
£11,908.01 - £50,270 10.25
Over £50,270 3.25

Class 3

  • A person needs 35 years (30 years if State Pension age is before 6 April 2016) of NIC to get a full State Pension.
  • Class 3 voluntary contributions can be paid to fill or avoid gaps in a NI record.

Class 3 - 2022/23

Flat rate per week £15.85

Pensions Automatic Enrolment

Auto enrolment places duties on employers to automatically enrol 'workers' into a work based pension scheme. Employers are required to automatically enrol all 'eligible jobholders' into a qualifying pension scheme and pay pension contributions on their behalf.

Employer minimum contribution Total minimum contribution
3% 8%

Where the employer does not make the total minimum contribution the employee is obliged to pay the balance.

  2022/23
Automatic enrolment earnings trigger £10,000
Qualifying earnings band - lower limit £6,240
Qualifying earnings band - upper limit £50,270

Pensions - tax relief on pension contributions

  • Tax relief available for personal contributions is the higher of £3,600 (gross) or 100% of relevant earnings.
  • Any contributions in excess of £40,000, whether personal or by the employer, may be subject to income tax on the individual.
  • The limit may be reduced to £4,000 once money purchase pensions are accessed.
  • Where the £40,000 limit is not fully used it may be possible to carry the unused amount forward for three years.
  • The annual allowance is tapered for those with adjusted income over £240,000. For every £2 of income over £240,000 an individual's annual allowance will be reduced by £1, down to a minimum of £4,000.
  • Employers will obtain tax relief on employer contributions if they are paid and made 'wholly and exclusively' for the purposes of the business. The tax relief for large contributions may be spread over several years.

Property allowance

  • A property allowance is available to individuals.
  • The property allowance will not apply to partnership income or to income on which rent a room relief is given.
Income up to £1,000 Property income assessable NIL
Income over £1,000 Election to deduct £1,000 rather than the actual expenses

Self assessment - key dates

31 January 2022 - First payment on account due for 2021/22 tax year.

31 July 2022 - Second payment on account for 2021/22 tax year.

5 October 2022 - Deadline for notifying HMRC of new sources of income (including the Child Benefit charge) if no tax return has been issued for 2021/22 tax year.

31 October 2022 - Deadline for submission of 2021/22 non-electronic returns.

30 December 2022 - Deadline for submission of 2021/22 electronic tax returns if 'coding out' of eligible underpayment is required.

31 January 2023 - Deadline for filing electronic tax returns for 2021/22. Balancing payment due for 2021/22 tax year. First payment on account due for 2022/23 tax year.

Stamp Duty

When you buy shares, you usually pay a tax or duty of 0.5% on the transaction. If you buy shares electronically Stamp Duty Reserve Tax (SDRT) is payable. For shares purchased using a stock transfer form, you will pay Stamp Duty if the transaction is over £1,000.

Stamp Duty Land Tax (SDLT)

  • SDLT is payable on land and property transactions in England and Northern Ireland.
  • Property transactions in Scotland are subject to Land and Buildings Transaction Tax (LBTT).
  • Property transactions in Wales are subject to Land Transaction Tax (LTT).

Residential property

The rates apply to the portion of the total value which falls within each band.

Consideration (£) Rate
0 - 125,000 0%
125,001 - 250,000 2%
250,001 - 925,000 5%
925,001 - 1,500,000 10%
1,500,001 and above 12%

These rates may be increased by 3% where further residential properties, costing over £40,000, are acquired.

First-time Buyer relief

From 1 July 2021 First-time buyers may be eligible for first-time buyer relief on purchases of residential property up to £500,000. The rates apply to the portion of the total value which falls within each band.

Consideration (£) Rate
0 - 300,000 0%
300,001 - 500,000 5%
for purchases over 500,000 normal rates apply

Non-residential SDLT rates

Consideration (£) Rate
0 - 150,000 0%
150,001 - 250,000 2%
Over 250,000 5%

Payable on consideration which falls in each band.

State Pensions

  • The basic State Pension is a regular payment from the government that an individual may be entitled to when they reach State Pension age.
  • The basic State Pension depends on the number of years an individual has paid National Insurance or has National Insurance credits, eg while unemployed or claiming certain benefits.
  • To receive the basic State Pension an individual must have paid or been credited with National Insurance contributions (NIC).
  • In 2016 the State Pension was reformed into a single-tier new State Pension. In order to benefit from the full amount the individual will need 35 years, rather than the previous 30 years of NIC or credits for the full amount, with pro-rating where 35 years is not achieved. You will usually need 10 qualifying years to get any State Pension. The amount an individual receives can be higher or lower depending on their National Insurance record. It will only be higher if you have over a certain amount of Additional State Pension.
  • Currently an individual may also be entitled to the Additional State Pension. How much an individual gets depends on the number of qualifying years of NIC, the amount of earnings and whether the individual has been contracted out of the scheme.
Weekly State Pension 2022/23  
Basic - single person £141.85
New State Pension £185.15

Tax reliefs for individuals

Enterprise Investment Scheme (EIS)

The Enterprise Investment Scheme (EIS) provides tax relief for individuals prepared to invest in new and growing companies. Investors can obtain generous income tax and capital gains tax (CGT) breaks for their investment and companies can use the relief to attract additional investment to develop their business. Individuals are entitled to relief on investments in certain unquoted trading companies through EIS. A junior version of EIS the SEIS is also available.

Maximum investment per annum £1,000,000
Additional investment limit where investing in knowledge-intensive companies £1,000,000
Income tax relief 30%
CGT treatment on disposal if held for 3 years Exempt

Capital gains from the disposal of other assets may be deferred by making an EIS investment.

Seed Enterprise Investment Scheme (SEIS)

The Seed Enterprise Investment Scheme (SEIS) provides tax relief for individuals prepared to invest in new and growing companies. Investors can obtain generous income tax and capital gains tax (CGT) breaks for their investment and companies can use the relief to attract additional investment to develop their business. SEIS is a junior version of EIS.

Maximum investment per annum £100,000
Income tax relief 50%
CGT treatment on disposal if held for 3 years Exempt

Capital gains from the disposal of other assets may be exempt up to £50,000 per annum by making an SEIS investment.

Social Investment Relief (SIR)

Social Investment Relief (SIR) is designed to encourage private individuals to invest in social enterprises including charities. Individuals are entitled to relief on their investment:

Maximum investment per annum £1,000,000
Income tax relief 30%
CGT treatment on disposal if held for 3 years Exempt

Capital gains from the disposal of other assets may be deferred by making a SIR investment.

Venture Capital Trusts (VCTs)

Venture Capital Trusts (VCTs) are designed to encourage private individuals to invest in smaller high-risk unquoted trading companies. VCTs operate by indirect investment through a mediated fund. In effect they are very like the investment trusts that are obtainable on the stock exchange, albeit in a high-risk environment. Individuals are entitled to relief on investments in VCTs.

Maximum investment per annum £200,000
Income tax relief 30%
Dividend income Exempt
Capital gains treatment on disposal Exempt

All reliefs are subject to detailed conditions being met.

Trade allowance

  • A Trade Allowance is available to individuals.
  • There is an equivalent rule for certain miscellaneous income. This will apply to the extent that the £1,000 trading allowance is not used against trading income.
  • The trade allowance is not available against partnership income.
Income up to £1,000 Profits assessable NIL
Income over £1,000 Election to deduct £1,000 allowance rather than the actual expenses

Van benefit

  • Van benefit is chargeable if the van is available for an employee's private use.
  • A fuel benefit may also be chargeable if an employee has the benefit of private fuel paid for in respect of a company van.
  • The charges do not apply to vans if a 'restricted private use condition' is met throughout the year.
  • From 6 April 2021 a 0% benefit charge may apply to vans which cannot emit CO2 when driven. 
Van benefits 2022/23
Van benefit £3,600
Fuel benefit £688

VAT

  • Registered businesses charge VAT on their sales. This is known as output VAT and the sales are referred to as outputs.
  • Similarly VAT is charged on most goods and services purchased by the business. This is known as input VAT.
  • There are three rates: standard which applies to most goods and services, reduced rate for some goods and services such as home energy and zero rate goods and services, for example, most food and children's clothes.
  • Some supplies are exempt from VAT for example postage stamps, financial and insurance transactions.
  • A business is required to register for VAT if the value of taxable supplies exceeds the annual registration limit.
VAT - rates and limits  
Standard rate 20%
Reduced rate 5%*
Annual Registration Limit
- from 1.4.22 - 31.3.23
£85,000
Annual Deregistration Limit
- from 1.4.22 - 31.3.23
£83,000

VAT fuel scale charges

Businesses must use these new VAT fuel scale charges from the start of their next prescribed accounting period beginning on or after 1 May 2021.

CO2
band
Gross monthly
£
VAT
£
Net
£
120 or less 48 8.00 40.00
125 72 12.00 60.00
130 77 13.00 65.00
135 82 14.00 68.00
140 87 14.50 72.50
145 91 15.17 75.83
150 97 16.17 80.83
155 102 17.00 85.00
160 106 17.67 88.33
165 111 18.50 92.50
170 116 19.33 96.67
175 121 20.17 100.83
180 126 21.00 105.00
185 130 21.67 108.33
190 136 22.67 113.33
195 141 23.50 117.50
200 145 24.17 120.83
205 150 25.00 125.00
210 155 25.83 129.17
215 160 26.67 133.33
220 165 27.50 137.50
225 or more 169 28.17 140.83
CO 2
band
Gross 3 month period £ VAT
£
Net
£
120 or less 145 24.17 120.83
125 219 36.50 182.50
130 233 38.83 194.17
135 247 41.17 205.83
140 262 43.67 218.33
145 277 45.83 230.83
150 292 48.67 243.33
155 306 51.00 255.00
160 321 53.50 267.50
165 336 56.00 280.00
170 350 58.33 291.67
175 364 60.33 303.33
180 379 63.17 315.83
185 394 65.67 328.33
190 409 68.17 340.83
195 423 70.50 352.50
200 438 73.00 365.00
205 453 75.50 377.50
210 467 77.83 389.17
215 481 80.17 400.83
220 496 82.67 413.33
225 or more 511 85.17 425.83
CO 2
band
Annual gross
£
VAT
£
Net
£
120 or less 585 97.50 487.50
125 875 145.83 729.17
130 936 156.00 780.00
135 992 165.33 826.67
140 1,053 175.50 877.50
145 1,109 184.83 924.17
150 1,170 195.00 975.00
155 1,226 204.33 1,021.67
160 1,287 214.50 1,072.50
165 1,343 223.83 1,119.17
170 1,404 240.00 1,170.00
175 1,460 243.33 1,216.67
180 1,521 253.50 1,267.50
185 1,577 262.83 1,314.17
190 1,638 273.00 1,365.00
195 1,694 282.83 1,411.67
200 1,755 292.50 1,462.50
205 1,811 301.83 1,509.17
210 1,872 312.00 1,560.00
215 1,928 321.33 1,606.67
220 1,989 331.50 1,657.50
225 or more 2,045 340.83 1,704.17

Where the CO2 emission figure is not a multiple of five, the figure is rounded down to the next multiple of five to determine the level of the charge.

For a bi-fuel vehicle which has two CO2 emissions figures, the lower of the two figures should be used.

For cars which are too old to have a CO2 emissions figure, you should identify the CO2 band based on engine size. If its cylinder capacity is:

  • If its cylinder capacity is 1,400cc or less, use CO2 band 140 
  • If its cylinder capacity exceeds 1,400cc but does not exceed 2,000cc, use CO2 band 175; 
  • If its cylinder capacity exceeds 2,000cc, use CO2 band 225 or above.

Vehicle Excise Duty (VED) - passenger cars

For vehicles first registered on or after 1 April 2017, the VED or 'Road Tax' rate for the first 12 months is based on CO2 emissions shown on the V5 (Registration Document).

Subsequent years are charged at the standard rate. Cars with a list price of over £40,000 when new pay an additional rate of £355 per year on top of the standard rate, for five years.

New diesel vehicles that do not meet the Euro 6d emissions standard are charged a supplement on their First Year Rate to the effect of moving up by one VED band.

VED bands and rates for cars first registered on or after 1 April 2017

CO2 emissions (g/km) Standard rate First year rate
0 £0 £0
1-50 £165 £10
51-75 £165 £25
76-90 £165 £120
91-100 £165 £150
101-110 £165 £170
111-130 £165 £190
131-150 £165 £230
151-170 £165 £585
171-190 £165 £945
191-225 £165 £1,420
226-255 £165 £2,015
Over 255 £165 £2,365

VED bands and rates for cars registered on or after 1 March 2001 but before 1 April 2017

VED band CO 2 emissions (g/km) Standard rate
A Up to 100 £0
B 101-110 £20
C 111-120 £30
D 121-130 £135
E 131-140 £165
F 141-150 £180
G 151-165 £220
H 166-175 £265
I 176-185 £290
J 186-200 £330
K 201-225* £360
L 226-255 £615
M Over 255 £630

*Including cars emitting over 225g/km registered before 23 March 2006.

 

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