Income tax rates and bands
England, Northern Ireland & Wales
| Tax bands and rates | 2021/22 | 2020/21 | |
| Basic-rate band | £37,700 | £37,500 | |
| Basic-rate tax | 20% | 20% | |
| Dividend ordinary tax rate | 7.5% | 7.5% | |
| Savings starting rate band limit* | £5,000 | £5,000 | |
| Savings starting rate - savings income | 0% | 0% | |
| Higher-rate band | Over £37,700 - £150,000 | Over £37,500 - £150,000 | |
| Higher-rate tax | 40% | 40% | |
| Dividend upper tax rate | 32.5% | 32.5% | |
| Additional-rate band over | Above £150,000 | Above £150,000 | |
| Additional-rate tax | 45% | 45% | |
| Dividend additional tax rate | 38.1% | 38.1% | |
| Personal allowance** | £12,570 | £12,500 | |
| High income child benefit charge - 1% of adjusted net income of £50,000 to £60,000 | |||
| Trading allowance*** | £1,000 | £1,000 | |
| Dividend allowance at 0% - all individuals | £2,000 | £2,000 | |
| Property allowance*** | £1,000 | £1,000 | |
| Savings allowance**** | £1,000 | £1,000 | |
| Marriage/civil partners transferable allowance***** | £1,260 | £1,250 | |
| Blind person's allowance | £2,520 | £2,450 | |
| Married couple's allowance (if at least one born before 6 April 1935) | Maximum amount | £9,125 | £9,075 |
| Tax reduction at 10% | £912.50 | £907.50 | |
| Minimum amount | £3,530 | £3,510 | |
| Tax reduction | £353 | £351 | |
| Non-domiciled remittance basis charge | |||
| Applies after UK residence in seven or more of the previous nine tax years (unless unremitted income under £2,000) | £30,000 | £30,000 | |
| Applies after UK residence in at least 12 of the previous 14 years (unless unremitted income under £2,000) | £60,000 | £60,000 | |
|
Enterprise investment scheme (EIS)**** up to |
£1m | £1m | |
| Maximum amount for EIS carry back | £50,000 | £50,000 | |
| Income tax relief rate for EIS | 30% | 30% | |
| Seed enterprise investment scheme (SEIS) | £100,000 | £100,000 | |
| Income tax relief for SEIS | 50% | 50% | |
| Venture capital trust (VCT)***** | £200,000 | £200,000 | |
| VCT tax relief rate | 30% | 30% | |
| Social investment tax relief (SITR) | £1m | £1m | |
| Income tax relief rate for SITR | 30% | 30% | |
| Golden handshake maximum tax-free | £30,000 | £30,000 | |
| Rent-a-room (exempt on gross annual rent up to) | £7,500 | £7,500 | |
| Construction industry scheme - deduction rate | |||
| Standard rate - registered | 20% | 20% | |
| Higher rate - not registered | 30% | 30% | |
| Child benefit charge - 1% of benefit per £100 of income between £50,000 and £60,000 | |||
* The starting rate does not apply if taxable income exceeds the starting rate limit.
** When the gross income is £1,000 or less. May alternatively be deducted from gross income instead of the actual expenses.
*** £500 for higher rate and £0 for additional-rate taxpayers.
**** Investment limit increases for investment in knowledge-intensive companies to £2 million.
***** Personal allowance reduced by £1 for every £2 of adjusted net income over £100,000.
****** Any unused personal allowance may be transferred to a spouse or civil partner, where the recipient is not liable to higher or additional tax.
Scotland
| 2021/22 | Band | Rate |
| Over £12,571*-£14,667 | Starter | 19% |
| Over £14,668- £25,296 | Basic | 20% |
| Over £25,297- £43,662 | Intermediate | 21% |
| Over £43,663- £150,000** | Higher | 41% |
| Above £150,000 | Top | 46% |
* Assumes individuals are in receipt of the personal allowance.
** Those earning more than £100,000 will see their personal allowance reduced by £1 for every £2 earned over £100,000.
Wales
Devolution of income tax to Wales commenced in April 2019. Under this, the three rates applying in England and Northern Ireland are reduced by 10% each, and it is open to the Welsh Assembly to impose their own three rates in each of the basic, higher and additional-rate bands.
However, the Welsh Assembly has decided that the rates will all be 10%, leaving the Welsh rates unchanged from the rates in England and Northern Ireland.
Termination payments: England, Wales & Northern Ireland only
Termination payments over £30,000, which are subject to income tax, are also subject to employers NICs from 6 April 2020.
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