TAXATION

Most of us risk being taxed on our income, our capital gains and the value of our estate when we die. It is worth getting a clear grasp of how these taxes work and then discussing with your financial adviser the most tax efficient financial planning for you.

Tax Table

			2021 - 2022			2022 - 2023
Personal Taxation
Income tax bands
Basic			£1 - £37,700			£1 - £37,700
Higher			£37,701 - £150,000			£37,701 - £150,000
Additional			Over £150,000			Over £150,000

Income tax rates (main rate)
Basic			20%			20%
Higher			40%			40%
Additional			45%			45%
Starting rates for savings income			0%			0%

Income tax rates (dividends)
Basic			7.50%			8.75%
Higher			32.50%			33.75%
Additional			38.10%			39.35%

Income tax allowances
Personal allowance			£12,570			£12,570
Starting rate for savings income			£5,000			£5,000
Dividend allowance			£2,000			£2,000
Personal savings allowance			£1,000 (BR) £500 (HR) £0 (AR)			£1,000 (BR) £500 (HR) £0 (AR)

Capital gains tax rates
Main rates for individuals			10% / 20%			10% / 20%
Residential property			18% / 28%			18% / 28%
Entrepreneur's relief rate			10%			10%

Capital gains tax allowances
Annual exempt amount			£12,300			£12,300
Entrepreneurs' Relief - Life time limit			£1,000,000 (gains after 11 March 2020)			£1,000,000 (gains after 11 March 2020)

Inheritance Tax
Nil rate band			£325,000			£325,000
Residential nil rate band (RNRB)			£175,000			£175,000
Rate (estates)			40%			40%
Reduced rate (10% of estate to charity)			36%			36%
Lifetime Rate (CLTs)			20%			20%

Trust Taxation
Income tax bands
Standard rate band			Up to £1,000			Up to £1,000

Income tax rates
Trust main rate			45%			45%
Trust dividend rate			38.10%			39.35%

Capital gains tax allowances
Annual exempt amount			£6,150			£6,150

Capital gains tax rates
Main rate			20%			20%
Residential property			28%			28%

Corporate
Corporation tax			19%			19%

ISA Allowance
Adult ISA Allowance			£20,000			£20,000
Junior ISA Allowance			£9,000			£9,000
National Insurance (Class 1, Standard Rate)
Threshold	2021/22	2022/23			2023/24
		6 April-5 July		6 July - 5 April
Weekly	£184	£190		£242	£242
Monthly	£797	£823		£1,048	£1,048
Annual (if applied for whole year)	£9,568	£9,880		£12,570	£12,570