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UK Tax rates at a glance
The rates and bands for the UK tax year 2009/10 are shown below (2008/09 levels shown for comparison)
Income Tax
Basic (20) |
0 - 37,400 |
0 - 34,800 |
Higher (40) |
Over 37,400 |
Over 34,800 |
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Savings income is taxable at 10% for income up to the starting rate band of £2,440 * and 20% for income between the starting rate and basic rate band limit of £37,400 and 40% above this, except for dividend income where the rate is 10% for income up to £37,400 and 32.5% above this.
* Note that this rate of tax is not available where an individual's non-savings income exceeds this limit.
Personal Allowances
The levels of allowances for 2009/10 are as follows (2008/09 levels are shown for comparison):-
Allowance |
2009/10 |
2008/09 |
Personal allowance |
6,475 |
6,035 |
Personal allowance (age 65-74) |
9,490 |
9,030 |
Personal allowance (age 75 and over) |
9,640 |
9,180 |
Blind person's allowance |
1,890 |
1,800 |
Married couples allowance * (aged less than 75 and born before 6 April 1935) |
N/A |
6,535 |
Married couples allowance * (aged 75 and over) |
6,965 |
6,625 |
Married couples allowance * (minimum amount) |
2,670 |
2,540 |
Income limit for age-related allowance |
22,900 |
21,800 |
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* Married couples allowance is given at the rate of 10%. It applies to couples where at least one spouse was born before 6 April 1935.
Inheritance Tax
The nil rate band increased from £312,000 to £325,000 with effect from 6 April 2009. The death & lifetime rates remain at 40% & 20% respectively. The threshold for 2010/11 will be £350,000.
Capital Gains Tax
The annual exemption increased in line with inflation from £9,600 to £10,100 with effect from 6 April 2009. The annual exemption for trustees is increased to £5,050. The rate of capital gains tax will be 18%.
Pension Scheme Allowances
For the tax year 2009/10 the annual allowance is £245,000 and the lifetime allowance is £1.75 million.
National Insurance Contribution Rates
Class 1 (weekly earnings) |
2009/10 £ |
2008/09 £ |
Lower earnings limit (primary) |
95 |
90 |
Upper earnings limit (primary) |
844 |
770 |
Primary threshold |
110 |
105 |
Secondary threshold |
110 |
105 |
Employees primary class 1 rate between £95.01 and £884 per week |
11% |
11% |
Employees primary class 1 on excess above £884 per week |
1% |
1% |
Employees contracted out rebate |
1.6% |
1.6% |
Employers secondary class 1 rate above secondary threshold |
12.8% |
12.8% |
Employers contracted out rebate (salary related schemes) |
3.7% |
3.7% |
Employers contracted out rebate (money purchase schemes) see note below |
1.4% |
1.4% |
Class 2 |
£2.40 per week |
£2.30 per week |
Class 2 small earnings exception |
£5,075 per year |
£4,825 per year |
Class 3 |
£12.05 per week |
£8.10 per week |
Class 4 rate on profits between £5,715 and £43,875 per year |
8% |
8% |
Class 4 rate on profits in excess of £43,875 per year |
1% |
1% |
Class 4 lower profits limit |
£5,715 |
£5,435 |
Class 4 upper profits limit |
43,875 |
40,040 |
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Note - For Contracted Out Money Purchase Schemes an additional age-related rebate is paid directly to the scheme by the National Insurance Contributions Office.
Corporation Tax
The corporation tax rates for 2009/10
Small companies rate |
21% |
£0 - £300,000 |
Marginal relief where profits |
£300,001 - £1,500,000 |
Main rate |
28% |
£1,500,001 or more |
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Stamp Taxes
The rate of stamp duty/stamp duty reserve tax on the transfer of shares and securities is 0.5%. The liability is subject to rounding up to the nearest £5.
Stamp Duty Land Tax
Transfers of property are subject to stamp duty land tax at the following rates. The £175,000 band for residential property applies to transactions between 3 September 2008 and 31 December 2009 inclusive. From 1 January 2010 the threshold for residential property will revert to £125,000 except where the property is situated in a disadvantaged area when it will revert to £150,000.
Cost |
Land in disadvantaged areas |
Other land in the UK |
Home |
Non residential |
Home |
Non residential |
Up to £175,000 |
0% |
0% |
0% |
0% |
£175,001 - £250,000 |
1% |
1% |
1% |
1% |
£250,001 - £500,000 |
3% |
3% |
3% |
3% |
over £500,000 |
4% |
4% |
4% |
4% |
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Important Notes
Please note that every care has been taken to ensure that the information provided is correct and in accordance with our current understanding of the law and Her Majesty's Revenue and Customs (HMRC) practice as at 6 April 2009. You should note however, that we cannot take on the role of an individual taxation adviser and independent confirmation should be obtained before acting or refraining from acting upon the information given. The law and HMRC practice are subject to change. Legislation varies from country to country and the policyholder's country of residence may impact on any of the above.
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