Income Tax
| Income tax rates | 1 | 2016/17 | 2015/16 |
|---|---|---|---|
| Starting rate limit (savings income) | 2 | *£5,000 | *£5,000 |
| Starting rate | 2 | *0% | *0% |
| Basic rate band – income up to | £32,000 | £31,785 | |
| Basic rate | 20% | 20% | |
| Dividend ordinary rate, otherwise taxable at basic rate | ***7.5% | 10% (0%**) | |
| Higher rate – income over | £32,000 | £31,785 | |
| Higher rate | 40% | 40% | |
| Dividend upper rate, otherwise taxable at higher rate | ***32.5% | 32.5% (25%**) | |
| Additional rate – income over | £150,000 | £150,000 | |
| Additional rate | 45% | 45% | |
| Dividend additional rate, otherwise taxable at additional rate | ***38.1% | 37.5% (30.6%**) |
|
| For 2016/17 Scottish taxpayers are effectively subject to the same income tax rates as the rest of the UK.
* If an individual’s taxable non-savings income exceeds the starting rate limit, then the starting rate will not be available for savings income For 2016/17, £1,000 of savings income for basic rate taxpayers (£500 for higher rate) may be tax-free. ** Effective rate with tax credit *** For 2016/17 the first £5,000 of dividends are tax-free |
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| Personal allowance (PA) | |||
| Born after 5 April 1938 | 3 | £11,000 | £10,600 |
| Born before 6 April 1938 | 4 | £11,000 | £10,660 |
| Income limit for PA | 3 | £100,000 | £100,000 |
| Income limit for PA (Born before 6 April 1938) | 4 | £27,700 | £27,700 |
| Blind person’s allowance | £2,290 | £2,290 | |
| Married couple’s allowance (MCA) | |||
| Either partner born before 6 April 1935 (relief restricted to 10%) | 5 | £8,355 | £8,355 |
| Transferable tax allowance (‘Marriage Allowance’) | |||
| For certain married couples and civil partners born after 5 April 1935 (relief 20%) | 6 | £1,100 | £1,060 |
| Tax Shelters | |||
| Venture Capital Trust (VCT) up to | £200,000 | £200,000 | |
| Enterprise Investment Scheme (EIS) up to | £1,000,000 | £1,000,000 | |
| Seed Enterprise Investment Scheme up to | £100,000 | £100,000 | |
| Social Investment Tax Relief | £1,000,000 | £1,000,000 | |
| Golden Handshake max. | £30,000 | £30,000 | |