Tax Rates 2011/2012
Income Tax rates
|0 – 2,440||10*|
|2,441 – 37,400||20**|
|37,401 – 150,000||40***|
*Only applicable to dividends and savings income. The 10% rate is not available if taxable non-savings income exceeds £2,560 (£2,440).
** Except dividends (10%).
*** Except dividends (32.5%).
**** Except dividends (42.5%).
Other income taxed first, then savings income and finally dividends.
Plant and machinery – Annual Investment Allowance (AIA)
The AIA gives a 100% write-off on most types of plant and machinery costs, including integral features and long life assets but not cars, of up to £100,000 p.a. (£50,000 for expenditure incurred before 6 April 2010 (1 April 2010 for companies). Special rules apply for accounting periods straddling these dates.)
Any costs over the AIA fall into the normal capital allowance pools at either 10% or 20%. The AIA may need to be shared between certain businesses under common ownership.
Other plant and machinery allowances
The annual rate of allowance is 20%. A 10% rate applies to expenditure incurred on integral features and on long life assets.
A 100% first year allowance may be available on certain energy efficient plant and cars, including expenditure incurred on new and unused zero emission goods vehicles on or after 6 April 2010 (1 April 2010 for companies).
For expenditure incurred on cars on or after 6 April 2009 (1 April 2009 for companies), costs are generally allocated to one of the two plant and machinery pools. Cars with CO2 emissions not exceeding 160gm/km receive a 20% allowance p.a. Cars with CO2 emissions over 160gm/km receive a 10% allowance p.a.
Industrial and agricultural buildings and hotels
The annual rate of allowance is nil (1%) from 6 April 2011 (1 April 2011 for companies). Special rules apply for accounting periods straddling these dates.
Income Tax Reliefs
|Personal allowance||– under 65||7,475|
|– 65 – 74*||9,940|
|– 75 and over*||10,090|
|(Reduce personal allowance by £1 for every £2 of adjusted net income over £100,000.)|
|Married couple’s allowance (relief at 10%)*
(Either partner 75 or over and born before 6 April 1935.)
|– min. amount||2,800|
|* Age allowance income limit
(Reduce age allowance by £1 for every £2 of excess income over £24,000 (£22,900).)
|Blind person’s allowance||1,980|
Value Added Tax
|Annual Registration Limit – from 1.4.11 (1.4.10 – 31.3.11 £70,000)||£73,000|
|Annual Deregistration Limit – from 1.4.11 (1.4.10 – 31.3.11 £68,000)||£71,000|
|Working Tax Credit|
|Basic element – max.||1,920|
70% (80%) of eligible costs up to £175 per week (£300 if two or more children).
|Child Tax Credit (CTC)|
|Child element per child – max.||2,555|
Capital Gains Tax
|*For higher and additional rate taxpayers|
For disposals on or after 6 April 2011 the first £10m (£5m for disposals on or after 23 June 2010 and before 6 April 2011) of qualifying gains are charged at 10%. Gains in excess of the limit are charged at the rates detailed above.
- Tax relief available for personal contributions: higher of £3,600 (gross) or 100% of relevant earnings.
- Any contributions in excess of £50,000 (£255,000), whether personal or by the employer, may be subject to income tax on the individual.
- Where the £50,000 limit is not fully used it may be possible to carry the unused amount forward for three years.
- Employers will obtain tax relief on employer contributions if they are paid and made ‘wholly and exclusively’. Tax relief for large contributions may be spread over several years.
2011/12 and 2010/11
|Nil||Nil||0 – 325*|
*Potentially increased for surviving spouses or civil partners who die on or after 9 October 2007.
|Annual exemption||£3,000||Marriage||– parent||£5,000|
|Small gifts||£250||– grandparent||£2,500|
|Reduced charge on gifts within seven years of death|
|Years before death||0-3||3-4||4-5||5-6||6-7|
|% of death charge||100||80||60||40||20|
Car and Fuel Benefits
Company cars 2011/12
Company cars 2011/12
|CO2 emissions (gm/km) (round down to nearest 5gm/km)||% of car’s list price taxed|
|up to 125||15|
|225 and above||35|
- For diesel cars add a 3% supplement but maximum still 35%.
- A 0% rate applies to cars which cannot emit CO2 when driven.
- A 5% rate applies to non-electric cars with emissions which do not exceed 75gm/km.
- A 10% rate applies to non-electric cars with emissions which do not exceed 120gm/km.
- The diesel supplement can apply to 75 and 120gm/km cars.
- For cars registered before 1 January 1998 the charge is based on engine size.
- The list price includes accessories and is not subject to an upper limit.
- The list price is reduced for capital contributions made by the employee up to £5,000.
Car fuel benefit 2011/12
£18,800 x ‘appropriate percentage’*
*Percentage used to calculate the taxable benefit of the car for which the fuel is provided.
- The charge does not apply to certain environmentally friendly cars.
- 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.
Van benefit per vehicle 2011/12
Van benefit £3,000
Fuel benefit £550
- The charges do not apply to vans which cannot emit CO2 when driven or if a ‘restricted private use condition’ is met throughout the year.
Main Social Security Benefits
|Basic retirement pension||– single person||£102.15|
|– married couple||£163.35|
|Statutory pay rates – average weekly earnings £102 (£97) or over|
|Statutory Sick Pay||£81.60|
|Statutory Maternity Pay|
|– First six weeks||90% of weekly earnings|
|– Next 33 weeks||£128.73*|
|Statutory Paternity Pay – two weeks||£128.73*|
|Statutory Adoption Pay – 39 weeks||£128.73*|
|* Or 90% of weekly earnings if lower.|
Additional Paternity Pay and Leave may be available for a child due or adoptions matched on or after 3 April 2011.
Mileage Allowance Payments
Cars and vans
|Up to 10,000 miles||45p|
|Over 10,000 miles||25p|
These rates represent the maximum tax free mileage allowances for employees using their own vehicles for business. Any excess is taxable. If the employee receives less than the statutory rate, tax relief can be claimed on the difference.
Class 1 (employed) contracted in
2011/12 Class 1 (employed) contracted in rates
|Earnings per week||%||Earnings per week||%|
|Up to £139||Nil*||Up to £136||Nil|
|£139.01 – £817||12||Over £136||13.8|
|* Entitlement to contribution-based benefits retained for earnings between £102 and £139 per week.|
|Class 1A (employers)||13.8% on employee taxable benefits|
|Class 1B (employers)||13.8% on PAYE Settlement Agreements|
|Class 2 (self-employed)||flat rate per week £2.50
small earnings exception p.a. £5.315 p.a.
|Class 3 (voluntary)||flat rate per week £12.60|
|Class 4 (self-employed)||9% on profits between £7,225 and £42,475 plus 2% on profits over £42,475|
Individual Savings Accounts (ISAs)
|Overall annual investment limit||10,680|
|Comprising||– cash up to||5,340 max.|
|– balance in stocks and shares||10,680 max.|
Years to 31.3.12
Years to 31.3.11
|Small profits rate||0 – 300,000||20*||0 – 300,000||21*|
|Marginal (small profits) rate||300,001 – 1,500,000||27.5*||300,001 – 1,500,000||29.75*|
|Main rate||Over 1,500,000||26*||Over 1,500,000||28*|
The profits limits are reduced for accounting periods of less than 12 months and for a company with associated companies.
*Different rates apply for ring-fenced (broadly oil industry) profit.