| All UK except Scotland (see below) | 2022/23 | 2023/24 |
| Basic rate | 20% | 20% |
| Higher rate | 40% | 40% |
| Additional rate | 45% | 45% |
| Starting rate for savings rate (applicable to savings income up to £5,000) | 0% | 0% |
| Savings allowance (0% tax applies to the first part of savings income): | ||
| Basic rate taxpayers | £1,000 | £1,000 |
| Higher rate taxpayers | £500 | £500 |
| Additional rate taxpayers | N/A | N/A |
| Higher rate applies to taxable income above (up to £150,000/£125,140 for 2023/24) | £37,700 | £37,700 |
| Additional rate applies to taxable income above | £150,000 | £125,140 |
| Dividend nil rate band (the amount on which 0% tax applies) | £2,000 | £1,000 |
| Dividend rate up to basic rate limit | 8.75% | 8.75% |
| Dividend rate up to higher rate limit | 33.75% | 33.75% |
| Dividend rate on income above higher rate limit | 39.35% | 39.35% |
| Trusts: | ||
| Flat rate applicable to discretionary and accumulation trusts | 45% | 45% |
| Dividend rate applicable to discretionary and accumulation trusts | 39.35% | 39.35% |
Income tax allowances and reliefs
| 2022/23 | 2023/24 | |
| Personal allowance | £12,570 | £12,570 |
| Transferable personal allowance (marriage allowance) | £1,260 | £1,260 |
| Registered blind person’s allowance | £2,600 | £2,870 |
| Age-related allowances: | ||
| Married couple’s allowance (MCA) for those born before 6 April 1935 – maximum | £9,415 | £9,415 |
| MCA for those born before 6 April 1935 – minimum | £3,640 | £3,640 |
- The savings rate of 0% applies to non-dividend income from savings, e.g. bank interest. The 0% rate does not apply if taxable non-savings income exceeds the total of your personal allowance plus the savings rate limit. Basic rate taxpayers are able to receive up to £1,000 of savings income tax free. The limit is £500 for higher rate taxpayers. There is no savings allowance for additional rate taxpayers.
- For discretionary and accumulation trusts the standard rates apply to the first £1,000 of income; 7.5%/8.75% for dividends and 20% for other types of income. The main rates in the table apply to income above £1,000.
- Personal allowances. Personal allowances are withdrawn from those with taxable income above £100,000 at the rate of £1 for each £2 of taxable income received above that amount. The withdrawal that applies to the age allowance will apply to withdraw the personal allowance for income above £100,000.
- Age-related allowances. Allowances are withdrawn at the rate of £1 for each £2 that the individual’s taxable income exceeds the limits shown in the table above.
- spouse or civil partner can transfer up to 10% of their unused personal allowances to their partner as long as neither is liable higher or additional rate tax. Autumn Budget 2017 proposed that transfer claims are to be allowed on behalf of deceased spouses and civil partners. Claims can be backdated for up to four years where conditions are met.
Scottish income tax
The Scottish tax rates apply to earned income only. Where a Scottish rate taxpayer has investment income the same rates apply to it as they would to taxpayers in the rest of the UK.
| 2022/23 | 2023/24 | |
| Personal tax-free allowance | £12,570 | £12,570 |
| Starter rate 19% on income between | £12,571 and £14,732 | £12,571 and £14,732 |
| Basic rate 20% on income between | £14,733 and £25,688 | £14,733 and £25,688 |
| Intermediate rate 21% on income between | £25,689 and £43,662 | £25,689 and £43,662 |
| Higher rate 41%/42% (2023/24) on income between | £43,663 and £150,000 | £43,663 and £125,140 |
| Top rate 46%/47% (2023/24) on income above | £150,000 | £125,140 |
Rent-a-room relief
- Rent-a-room relief amount is set at £7,500 (£4,250 for 2015/16 and earlier years). Individuals letting accommodation in their only or main residence, whether or not they are resident at the same time, as furnished accommodation are exempt on rental and related income (rent-a-room receipts) up to a limit of £7,500 a year.
- Receipts in excess of £7,500 are taxed in full, but the taxpayer can elect to be taxed instead on either the full rent less expenses incurred under a normal rental business computation; or to be taxed on the rents in excess of the rent-a-room relief amount.
Trading allowance and property allowance
- Two new tax-free allowances are available to individuals with small amounts of income from trading or property rental sources. A “trading allowance” and a “property allowance”. Both allowances are £1,000 each.
- In each case the £1,000 allowance applies to “income” (the receipts of the trade or property rental business) not profits.
Trading allowance
- The trading allowance can be used against business income and certain miscellaneous income from providing assets or services in the course of a trade. Elections can be made so that the allowance is not given partially or at all. The amount of relief depends on whether the trading income exceeds £1,000.
- if the income is less than £1,000, there is complete exemption and there is no need to notify HMRC or enter it on a tax return.
- if the income is more than £1,000 there is a choice. Either deduct actual business expenses or elect to treat the £1,000 as tax deductible in place of the actual expenses incurred.
- A decision whether or not to elect can be made on a year-by-year basis.
- There is no relief if the income has been received from:
- an employer, or spouse’s (or civil partner’s) employer
- a partnership in which you (or a connected party) are a partner
- a close company in which you (or an associate) are a participator.
Property allowance
- The property allowance can be used against rental income and certain miscellaneous income from providing assets or services in the course of a trade. Elections can be made so that the allowance is not given at all, or partially.The amount of relief depends on whether the income exceeds £1,000.
- if the income is less than £1,000 there is complete exemption and there is no need to notify HMRC or enter it on a tax return.
- if the income is more than £1,000 there is a choice. Either deduct actual property expenses or elect to treat the £1,000 as tax deductible in place of the actual expenses incurred.
- A decision whether or not to elect can be made on a year-by-year basis.
- The property allowance cannot be claimed where:
- rent-a-room relief applies or could apply to the income; or
- where the restriction (which took effect on 6 April 2017) on tax-deductible loan interest and other costs used to buy or improve residential accommodation applies.