Budget Summary 2015/16

Income Tax Rates and Allowances

Income Tax Rates and Allowances (Table A)

Main allowances 2015/16 2014/15
Personal Allowance (PA) £10,600 £10,000
Personal Allowance (born 6.4.38-5.4.48) 10,600 *10,500
Personal Allowance (born before 6.4.38) *10,660 *10,660
Transferable Tax Allowance** 1,060 Nil
Blind Person's Allowance 2,290 2,230
Allowed only at 10%
Married Couple's Allowance (MCA)
only available if born before 6.4.35

*8,355

*8,165
Age-related allowances income limit (AAIL) 27,700 27,000

PA is withdrawn at £1 for every £2 by which net income exceeds £100,000, such that PA becomes nil at income of £121,200 (2014/15: £120,000)

*These allowances are reduced by £1 for every £2 by which income exceeds AAIL. Personal allowance is reduced before MCA, until equal to normal PA. MCA is reduced to minimum £3,220 (2014/15: £3,140).

**Married couples/civil partners born after 5 April 1935 can transfer this amount of the PA between them as long as the recipient is not taxed at more than 20%.

Rate Bands 2015/16 2014/15
Basic rate band (BRB) £31,785 £31,865
Higher rate band 31,786-150,000 31,866-150,000
Additional rate over 150,000 over 150,000

Tax Rates  
Rates differ for General, Savings and Dividend income within each band:
  G S D
Basic 20% 20% 10%
Higher 40% 40% 32.5%
Additional 45% 45% 37.5%

If taxable general income is less than £5,000 (2014/15: £2,880), savings income is taxed at a ‘starting rate’ of nil (2014/15: 10%) until total taxable income exceeds that limit. This ‘starting rate band’ is part of the BRB.

High Income Child Benefit Charge (HICBC)

1% of child benefit for each £100 of adjusted net income between £50,000 and £60,000.

Remittance basis charge 2015/16 2014/15
For non-UK domiciled individuals who have been
UK resident in at least
   
7 of the preceding 9 tax years £30,000 £30,000
12 of the preceding 14 tax years 60,000 50,000
17 of the preceding 20 tax years 90,000 N/A

Registered Pensions (Table B)

  2015/16 2014/15
Lifetime allowance (LA) £1.25m £1.25m
Annual allowance (AA) 40,000 40,000
LA charge if excess drawn as cash 55%/income 25%
AA charge on excess inputs 20%-45%

Annual relievable pension inputs are the higher of earnings (capped at AA) or £3,600.

Car and Fuel Benefits (Table C)

Cars

Taxable benefit is chargeable value multiplied by chargeable percentage.

Chargeable value:

Initial list price of car (including most accessories), reduced by any capital contribution (maximum £5,000) by employee when the car is first made available.

Chargeable percentage:

CO2 emissions (g/km) Petrol Diesel
0-50 5% 8%
51-75 9% 12%
76-94 13% 16%
Above 94 Add 1% for every 5g/km
Above 210 (petrol)/ 195 (diesel) 37% maximum

Car Fuel

Where employer provides fuel for private motoring in an employer-owned car, CO2-based percentage from above table multiplied by £22,100 (2014/15 £21,700).

Employee contributions for fuel do not reduce taxable figure unless all private fuel is paid for by the employee (in which case there is no benefit charge).