Tax, accountancy and business support for the small and medium sized business

Website © Tyers Accountancy Ltd 2017

01469

533203

Tyers Accountancy

2017-18 Tax Rates and Allowances

Call us on

01469 533203

Or

Use the Contact Form

Or

Email using contact@tyers-accountancy.co.uk


Get in touch

Income Tax



Personal allowance

£11,500

The amount of income you can receive before paying tax. The allowance reduces by £1 for every £2 of income over £100,000.

Basic Rate

20%

Tax is charged at this rate on the first £33,500 (basic rate band) of income in excess of the personal allowance (PA).

Higher Rate

40%

Tax is charged at this rate on the next £116,500 (higher rate band) of income in excess of the basic rate band.

Additional rate

45%

Tax is charged at this rate on all income in excess of the higher rate band. All savings income is taxable.

Personal Savings Allowance - Basic Rate

£1,000

The amount of savings interest you can receive tax-free. If your total taxable income is less than £17,000 you won’t pay tax on savings income.

Personal Savings Allowance - Higher Rate

£500

Dividend allowance

£5,000

This is the total amount of dividends you can receive before paying tax.

Dividend basic rate

7.5%

The tax rate you are charged on dividends you receive over the dividend allowance depends on which of the above income tax bands you are in.

Dividend higher rate

32.5%

Dividend additional rate

38.1%

National Insurance


Class 1

12%

Employees pay Class 1 at this rate on their wages in excess of £157 and below £866/week.

Class 1

2%

Employees pay Class 1 at this rate on their wages in excess of £866/week.

Class 2

£2.85/wk

The self employed pay Class 2 if their income is over the Small Profits Threshold. For the self-employed Class 2 is important for benefit entitlement.

Small Profits Threshold

£6,025

Class 2 National Insurance is calculated automatically if total self-employment income exceeds the Small Profits Threshold.

Class 4

9%

The self employed pay Class 4 at this rate on their taxable profits in excess of £8,164/year and below £45,000/year. Class 4 provides no benefits.

Class 4

2%

The self employed pay Class 4 at this rate on their profits in excess of £45,000/year.

VAT


VAT registration threshold

£85,000

You must register for VAT with HM Revenue and Customs if your business’ VAT taxable turnover exceeds the registration threshold

VAT deregistration threshold

£83,000

You can ask HM Revenue and Customs to cancel your registration if your VAT taxable turnover falls below the de-registration threshold.

Standard rate

20%

VAT rates for goods and services. Some things are exempt from VAT, e.g. postage stamps.

Reduced rate

5%

The reduced rate of VAT applies to certain goods and services, including domestic heating fuel, children’s car seats, sanitary protection products.

Flat rate scheme joining threshold

£150,000

The VAT Flat Rate Scheme is an alternative (and sometimes simpler) way for businesses to work out how much VAT they owe to HMRC.

Flat rate scheme leaving threshold

£230,000