Tax Rates and Allowances
Below you will find this year's and last year's tax allowances. Please contact us to make sure that you have got the correct information.
> | 2013/14 | 2012/13 | |
Income Tax | |||
Personal allowance | Under 65 | £9,440 | £8,105 |
65 to 74 | £10,500 | £10,500 | |
75 and over | £10,660 | £10,660 | |
Blind person's allowance | £2,160 | £2,100 | |
Tax Rates | |||
Basic rate band | £32,010 | £34,370 | |
Basic tax rate | 20% | 20% | |
Tax on UK dividends within starting and basic rate bands | 10% | 10% | |
Higher rate band | £32,010- £150,000 | £34,371- £150,000 | |
Higher tax rate | 40% | 40% | |
Higher rate dividend | 32.5% | 32.5% | |
Additional rate band | Over £150,000 | Over £150,000 | |
Additional rate tax | 45% | 50% | |
Additional rate dividend | 37.5% | 42.5% |
Corporation Tax | ||
Corporation tax rates and bands are as follows: | ||
Financial year to | 31 March 2014 | 31 March 2013 |
Taxable Profits | ||
First £300,000 | 20% | 20% |
Next £1,200,000 | 23.75% | 25% |
On profits over £1,500,000 | 23% | 24% |
Marginal relief fraction | 3/400 | 1/100 |
Corporation Tax Payable | ||
For small and medium sized companies | ||
- Nine months and one day after the end of the accounting period | ||
The Annual Investment Allowance (AIA) offers tax relief at 100% on qualifying expenditure in the year of purchase. The maximum you can deduct from your taxable profits is £250,000 (from 1 January 2013). This limit is adjusted for short or long periods, and also for periods that span the operative dates and rates of allowance. |
Mileage Allowances | ||
For employees using their own transport | ||
The approves maximum tax and national insurance free mileage allowances for employees using their own transport for business are as follows: | ||
First 10,000 miles | Over 10,000 miles | |
Car | 45p | 25p |
Motorcycle | 24p | 24p |
Bicycle | 20p | 20p |
Income Tax and NICs are due when allowances exceed these rates. Employees can claim tax relief on any shortfall. | ||
Rates of up to 5p per mile, per passenger, are also tax and NIC free when paid for the carriage of fellow employees on the same business trip. |
Value Added Tax | ||
From | 1 Apr 2013 | 1 Apr 2012 |
Standard rate | 20% | 20% |
Standard rate VAT fraction | 1/6 | 1/6 |
Reduced rate | 5% | 5% |
Reduced rate VAT fraction | 1/21 | 1/21 |
Taxable Turnover Limits | ||
Registration - last 12 months or next 30 days over | £79,000 | £77,000 |
Deregistration - next 12 months under | £77,000 | £75,000 |
Cash accounting scheme - up to | £1,350,000 | £1,350,000 |
Optional flat rate scheme - up to | £150,000 | £150,000 |
Annual accounting scheme - up to | £1,350,000 | £1,350,000 |