2019/20 Tax Rates and Allowances

Income tax
2019/20 2018/19
Starting rate for savings only income 0% £5,000 £5,000
Dividend Allowance 0% £2,000 £5,000
Basic rate 20% (7.5% for dividends above £5,000) £37,500 £34,500
Higher rate 40% (32.5% for dividends) £37,501 –

£150,000

£34,501 –

£150,000

Additional rate 45% (38.1% for dividends) £150,001+ £150,001+
Personal savings allowance – 0% for basic rate tax payers on £1000, £500 for higher rate tax payers. 20%, 40% and 45% 20%, 40% and 45%

 

Personal Allowances
2019/20 2018/19
Everyone £12,500 £11,850*
No longer a higher rate for older tax payers
 
 
*Reduced by £1 for every £2 above income limit, but will not reduce below basic Personal Allowance unless income over £100,000

 

 

Pensions
Annual allowance 100% of net relevant earnings or £3,600 if higher
Capped at: £40,000 2019/20
Note:  Ability to utilise unused annual allowances of up to £40,000 for 2019, 2018 and 2017 if member of defined benefit or contribution scheme in previous 3 years.  Amount is tapered if adjusted annual income exceeds £150,000.  Money purchase annual allowance (if in draw down) £4,000
Lifetime limit £1.055 million
Amounts exceeding lifetime limit taxed at 55% if extracted as a lump sum, or 25% if not

 

Inheritance Tax
Exempt transfers:
Gifts to UK domiciled spouse*
Gifts to charity*
Overseas domiciled spouse up to £325,000*
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*

*To be confirmed

Nil rate band: £325,000 (18/19 £325,000)
Rate of tax at death 40%*
*36% where 10% of estate left to charity
Residence Nil Rate band £150,000 (previously £125,000)
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
2019/20 2018/19
Individual Exemption
£12,000
£11,700
Chattels Exemption
£6,000
£6,000
Trusts exemption
£6,000
£5,850
Transfers between husband and wife living together are exempt.
Main Rate 20%^ 20%
Basic Rate 10%^ 10%
Entrepreneurs Rate* 10% 10%
* Available on first £10 million of eligible gains in lifetime

^ Does not apply to residential property which remains at 28% and 18%

Corporation Tax
Year commencing 1 April 2019 1 April 2020
   19%   19%
 
 
 

 

Main Capital Allowances
Motor cars (based on CO2 emissions)
Less than 75g/km CO2 100%
75-130g/km CO2  18% rb
More than 130g/km CO2 8% rb
Plant & Machinery * 18% rb
Computer Equipment *  18% of rb
Integral features – 6% rb
Goodwill – 4% on certain unconnected party transactions only
 Structures and Buildings Allowance (SBA)  2% sl
*Annual Investment Allowance – 100% allowance on certain capital expenditure up to £200,000pa

rb = reducing balance   sl = straight line basis

 

 

Value Added Tax
Standard Rate
From 1st January 2017 20.00%
 
VAT fraction
From 1st January 2017 1/6
 
Turnover registration limit £85,000
Turnover deregistration limit £83,000
Cash/annual accounting registration limit £1.35m excl. VAT
Cash/annual accounting £1.6m excl. VAT
Flat rate scheme income £150,000 excl. VAT
Flat rate scheme income deregistration limit £230,000 incl. VAT
VAT Scale Charge: Now based upon the CO2 Emissions of the vehicle concerned

 

NI Contributions
2019/20
Class 1 Employer Employee
Weekly earnings % of all earnings
£0 – £118 NIL NIL
£118 – £166 0.00% 0%
£167 – £962 13.80% 12%
Over £962 13.80% 2%
The above rates apply to those not contracted out of S2P.
Class 1A Employer 13.80%
Class 2* S/Employed £3 pw
Class 3 Voluntary £115 pw
Class 4 S/Employed
£0 – £8,632 £0-£8,424 0%
£8,633 – £50,000 £8,425 – £46,350 9%
Over £50,000  Over £46,350 2%
* Payable on net earnings over £6,365 (18/19 £6,025)

 

Vehicle Benefits
Chargeable on all directors and employees
Car Benefit*: This is now 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 £24,100
* Percentage used will be dependent on the level of CO2 vehicle emissions
Van benefit per vehicle: £3,430 if there is any private use.  Travel between home and work is not considered private use
Van Fuel Benefit: £655

 

Mileage Allowances
The maximum tax-free mileage allowances for employees using their own cars for business are as follows:
2019/20 First 10,000 Miles 10,000+ miles
Car & Van 45p* 25p*
Motorcycle 24p* 24p*
Bicycle 20p* 20p*
Notes: 1 Payments in excess of approved rates are taxable 2 Where payments are made at rates less than the approved rates, employees can claim tax relief on shortfall
*To be confirmed

 

Stamp Duty Land Tax
Residential Properties

Residential Properties where you are NOT a first-time buyer**

SDLT is charged at the following rates for each portion of the purchase price.

Property purchase price SDLT rate
Up to £125,000 0%
The next £125,000 (the portion from £125,001 to £250,000) 2%
The next £675,000 (the portion from £250,001 to £925,000) 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
The remaining amount (the portion above £1.5 million) 12%

SDLT is charged at a flat rate of 15% on residential properties costing more than £500,000 purchased by certain corporate bodies

NOTE – Add 3% to the above rates where it is an additional property.

** First time buyers (including those with shared ownership from 22nd Nov 2017) pay 0% on the first £300,000, 5% between £300,000 and £500,000.  Property worth more than this is subject to normal SDLT rates above

 

 

Non-Residential or Mixed Use Property
SDLT is charged at the following rates for each portion of the purchase price.
Property purchase price SDLT rate
Up to £150,000 0%
The next £150,001 (the portion from £150,001 to £250,000) 2%
Above £250,000 5%
 

 

Leases
SDLT is charged at the following rates for each portion of the purchase price.
Net Present Value (NPV) of the lease SDLT rate
Up to £150,000 0%
The next £4,850,000 (the portion from £150,001 to £5,000,000) 1%
Above £5 million 2%
 

 

Annual Tax on Enveloped Dwellings (ATED)

ATED may be payable annually on UK residential properties owned partly or wholly by certain corporate bodies, at the following rates:

Property value

 

2019/20
2018/2019
Less than £500,000 0  0
£500,000 to £1 million £3,650 £3,600
Between £1 million and £2 million £7,400 £7,250
Between £2 million and £5 million £24,800 £24,250
Between £5 million and £10 million £57,900 £56,550
Between £10 million and £20 million £116,100 £113,400
More than £20 million £232,350 £226,950