BUDGET - Tax Rates 2008/09
|
| Income Tax Allowances & Rates | 2008/09 | 2007/08 |
 | £ | £ |
| Personal Allowance (<65) | 6.035 | 5,225 |
| Personal Allowance (65 to 74) | 9,030 | 7,550 |
| Personal Allowance (>74) | 9,180 | 7,690 |
| Married Couples' Allowance (65 to 74) * | 6,535 | 6,285 |
| Married Couples' Allowance (>74) | 6,625 | 6,365 |
| Maximum Income before abatement of age related reliefs | 21,800 | 20,900 |
| Blind Person's Allowance | 1,800 | 1,730 |
Pension Scheme Annual Allowance
Pension Scheme Lifetime Allowance | 235,000
1.65m | 225,000
1.6m |
| Rent-a-Room Relief | 4,250 | 4,250 |
| Inheritance Tax Threshold | 312,00 | 300,000 |
| * No relief available for Married Couples born before 6th April 1935 | | |
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| Capital Gains Tax - Rates & Allowances | 2008/09 | 2007/08 |
| | |
| Annual Exempt Amount | £9,600 | £9,200 |
| Capital Gains Tax Rate(s) | 18% | 10 / 20 / 40% |
| Entrepreneur's relief * - first £1m of gains | 10% | N/A |
* Please note that with effect from 6th April 2008, indexation and taper relief have
been withdrawn and replaced with entrepreneur's relief. |
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| National Insurance Contributions - Class 1 (Employee) | 2008/09 | 2007/08 |
| £ | £ |
| Lower Earnings Limit | 90 weekly
390 monthly
4,680 yearly | 87 weekly
377 monthly
4,524 yearly |
| | |
| Primary Threshold | 105 weekly
455 monthly
5,460 yearly | 100 weekly
435 monthly
5,225 yearly |
| | |
| Upper earnings limit | 770 weekly
3,336 monthly
40,040 yearly | 670 weekly
2,904 monthly
34,840 yearly |
| Rate on earnings up to primary threshold | 0% | 0% |
| | |
| Not contracted out rate on £105 - £770 weekly | 11% | 11% |
| Not contracted out rate - over £770 weekly | 1% | 1% |
| | |
| Contracted out rate on £105 - £770 weekly | 9.4% | 9.4% |
| Contracted out rate - over £770 weekly | 1% | 1% |
| | |
| Reduced rate* on £105 - £770 weekly | 4.85% | 4.85% |
| Reduced rate* - over £770 weekly | 1% | 1% |
| | |
| * The reduced rate applies to married woman or widows with a valid certificate of election. Men over 65and woman over 60 pay no primary contributions, though employers still pay the secondary contributions at the usual rate. People under 16 and their employers pay no contributions. | | |
| | |
| National Insurance Contributions - Class 1 (Employer) | 2008/09 | 2007/08 |
| £ | £ |
| Earnings Threshold | 105 weekly
455 monthly
5,460 yearly | 100 weekly
435 monthly
5,225 yearly |
| Not contracted out rate (above threshold) | 12.8% | 12.8% |
Contracted out rate:
Salary-related
Money-purchase |
9.1%
11.2% |
9.1%
11.4% |
| | |
| National Insurance: Other | 2008/09 | 2007/08 |
| £ | £ |
| Class 1A (Employers only) | 12.8% | 12.8% |
| Class 1B (Employers only) | 12.8% | 12.8% |
| Class 2 (Self-employed) | 2.30 per week | 2.20 per week |
| Class 3 (Voluntary) | 8.10 per week | 7.80 per week |
| Class 4 (£5,435 - £40,040) | 8% | 8% |
| Class 4 (Over £40,040) | 1% | 1% |
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| Tax Bands & Rates - Income Tax | 2008/09 | 2007/08 |
| £ | £ |
| Income excluding dividends and other investment income | | |
| Lower Rate Band (£) - Restricted to savings income only from 2008/09 | N/A | Up to 2,230 |
| Lower Rate | N/A | 10% |
| | |
| Basic Rate Band (£) | 34,800 | 2,231 to 34,600 |
| Basic Rate | 20% | 22% |
| | |
| Higher Rate Band (£) | Over 34,800 | Over 34,600 |
| Higher Rate | 40% | 40% |
| | |
| Dividends / Bank Interest & other savings income | | |
| Lower Rate Band (£) | Up to 2,320 | Up to 2,230 |
| Lower Rate | 10% | 10% |
| | |
| Basic Rate Band (£) | 2,320 to 34,800 | 2,230 to 34,600 |
| Basic Rate | 10% / 20% | 10% / 20% |
| | |
| Higher Rate Band (£) | Over 34,800 | Over 34,600 |
| Higher Rate | 32.5% / 40 % | 32.5% / 40% |
| There is a 10% tax credit attached to dividends from 6/4/99 even though ACT is abolished from that date | | |
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| Tax Bands & Rates - Corporation Tax | 2008/09 | 2007/08 |
| £ | £ |
| Small Companies Rate (SCR) | 21% | 20% |
| On profits chargeable to CT over | 0 | 0 |
| On profits chargeable to CT up to | 300,000 | 300,000 |
| | |
| Upper Marginal Rate | 29.75% | 32.5% |
| On profits chargeable to CT over | 300,000 | 300,000 |
| On profits chargeable to CT up to | 1.5m | 1.5m |
| | |
| Standard Rate | 28% | 30% |
| On profits chargeable to CT over | 1.5m | 1.5m |
| | |
| * The 19% non-corporate distribution rate & starting rate was repealed from 1st April 2006. | | |
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| Value Added Tax | 2008/09 | 2007/08 |
| £ | £ |
| Registration Threshold | 67,000 | 64,000 |
| Standard Rate | 17.5% | 17.5% |
| Lower Rate | 5% | 5% |
| Zero Rate | 0% | 0% |
VAT Flat Rate Scheme
The scheme is open to small businesses whose annual taxable turnover (not including VAT) does not exceed £150,000 and whose total turnover (including the value of exempt and non-taxable income but not including VAT) does not exceed £187,500 a year.
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Stamp taxes & Duties
Transfers of Land & Buildings (consideration paid)
| Rate | Residential in disadvantaged areas | Residential outside disadvantaged areas | Non – Residential |
| 0% | £0 - £150,000 | £0 - £125,000 | £0 - £150,000 |
| 1% | Over 150,000 - £250,000 | Over £125,000 - £250,000 | Over £150,000 - £250,000 |
| 3% | Over £250,000 - £500,000 | Over £250,000 - £500,000 | Over £250,000 - £500,000 |
| 4% | Over £500,000 | Over £500,000 | Over £500,000 |
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