Tax facts - 2019/20

Based on Budget announcements on 29 October 2018.

For more information on tax rates, please click on the links below or download the Tax Facts PDF.

INCOME TAX RATES
   2019/20 Rate 2018/19 Rate Note
Individuals - UK        
Starting rate
£1 - £5,000 20% £1 - £5,000 20% A, D
Basic rate £5,001 - £37,500 20% £5,001 - £34,500 20% B, C, D
Higher rate £37,501 - £150,000 40% £34,501 - £150,000 40% B, D
Additional rate
Over £150,000 45% Over £150,000 45% B, D

Individuals - Scottish income tax



 
 
Starter rate 
£1 - £2,000 19% £1 - £2,000 19%  D
Basic rate 
£2,001 - £12,150 20%  £2,001 - £12,150 20% C, D
Intermediate rate £12,151 - £31,580 21% £12,151 - £31,580 21% D
Higher rate
£31,581 - £150,000 41% £31,581 - £150,000 41% D
Top/Additional rate Over £150,000 46% Over £150,000 46% D
Trusts        
Standard rate £1 - £1,000 20% £1 - £1,000 20% B
Trust rate Over £1,000 45% Over £1,000 45% B

A Rate on non dividend savings income up to £5,000 is 0% where taxable non savings income does not exceed £5,000.
B A dividend allowance effectively taxes the first £2,000 dividends received at 0%. Dividends above this limit are taxed at 7.5% for basic and standard rate taxpayers, 32.5% for higher rate taxpayers and 38.1% for additional and trust rate taxpayers.
C Basic rate band increased by gross Gift Aid donations and most personal pension contributions.
D Scottish income tax and rate bands apply to earned, pensions and property income of Scottish taxpayers. UK income tax rates and bands apply for other income, including savings and dividend income, of Scottish taxpayers. The Scottish Budget will be announced on 12 December 2018 and the Scottish rates and bands for 2019/20 will then be updated. With effect from 6 April 2019, the Welsh Government also has the right to set the Welsh rate of income tax that applies to earned, pension and property income of Welsh taxpayers in addition to the UK rates less 10%. The Welsh Government has set the Welsh rate on income tax at 10% for 2019/20, leaving the combined UK plus Welsh rates the same as those applying in England and Northern Ireland.

INCOME TAX ALLOWANCES
  2019/20 2018/19  Note
Basic personal allowance  £12,500 £11,850 A, B
Married/civil partners allowance £8,915 £8,695 B, C
Minimum married/civil partners allowance £3,450 £3,360 B, C
Married/civil partners transferable allowance £1,250 £1,190 B
Income limit for married/civil partners allowance £29,600 £28,900  
Blind persons allowance £2,450 £2,390  
Rent a room relief limit £7,500 £7,500  
Savings allowance £1,000 £1,000 D
Trading income allowance £1,000 £1,000 E
Property income allowance £1,000 £1,000 E

A Reduced by £1 for every £2 of income over £100,000.
B Non residents may not be entitled to personal allowances, in certain circumstances.
C Available to persons born before 6 April 1935. Relief limited to 10%. Reduced to minimum allowance by £1 for every £2 over income limit. Minimum allowance reduced by £1 for every £2 income over £100,000 after applying personal allowance reduction.
D £500 for higher rate and £nil for additional rate taxpayers.
E If gross income in excess of £1,000, a deduction of £1,000 instead of actual expenses is permitted.
Note: High income child benefit charge: 1% of the benefit per £100 of adjusted net income over £50,000: 100% of the benefit when adjusted net income is over £60,000.

PENSION CONTRIBUTIONS
  2019/20 2018/19 Note
Annual allowance £40,000 £40,000 A
Lifetime allowance £1,055,000 £1,030,000  

A Up to the lower of 100% of earnings or the maximum contribution. Maximum contribution is the annual allowance plus unutilised allowances from the three previous tax years. Up to £3,600 may be contributed irrespective of earnings. Annual allowance reduced by £1 for every £2 income over £150,000 to a minimum of £10,000, and to £4,000 maximum if certain pension drawings made.

CAPITAL GAINS TAX

2019/20 2018/19 Note
Annual exemption      
Individuals £12,000 £11,700  
Trusts £6,000 £5,850  
Entrepreneurs' relief lifetime allowance £10m £10m  
Investors' relief lifetime allowance £10m £10m  
Individuals and trusts      
Basic and starting rate taxpayers 10% 10% A
Higher and additional rate taxpayers 20% 20% A
Trusts and personal representatives 20% 20% A
Rate where entrepreneurs'/investors' relief applies 10% 10%

A Gains on carried interest and chargeable residential property - 8% surcharge.

Note: Non UK residents subject to capital gains tax (or corporation tax for companies) on sale of UK residential property and, from 6 April 2019, non residential property and certain disposals of interests in UK property rich entities. 

Note: From 6 April 2019, certain disposals of UK land and buildings by non residents must be reported and the tax paid to HMRC within 30 days of sale. Similar rules will apply for certain disposals of residential property by UK residents from 6 April 2020.

INHERITANCE TAX
  2019/20 2018/19 Note
Nil rate band (NRB) £1 - £325,000 0% 0% A
Over £325,000 40% 40% B, C
Main exemptions   Gifts on marriage or civil partnership  
Annual gifts per donor £3,000 Parent £5,000
Small gifts per donee £250 Grandparent/remoter ancestor £2,500
Normal expenditure out of income Exempt Other £1,000

A Additional residence nil rate band (RNRB) of £150,000 (2018/19 £125,000) for transfers of a main residence to direct descendants. NRB and RNRB for estate of surviving spouse are increased by unutilised percentage of NRB and RNRB of predeceased spouse. RNRB tapers away for estates over £2m.
B Some lifetime gifts are taxed at 20%.
C Tax rate reduced to 36% where 10% or more of net chargeable estate is left to charity.

NON DOMICILED REMITTANCE BASIS USERS
2019/20 2018/19
Personal allowance Nil Nil
Capital gains tax annual exemption Nil Nil
Remittance basis charge    
Unremitted income less than £2,000 Nil Nil
Resident in at least 7 of the previous 9 tax years £30,000 £30,000
Resident in at least 12 of the previous 14 tax years £60,000 £60,000

Note: Certain returning former UK domiciled individuals, and non domiciled individuals who have been resident in the UK in at least 15 of the previous 20 tax years, are treated as if UK domiciled for income tax, capital gains tax and inheritance tax purposes.

NATIONAL INSURANCE CONTRIBUTIONS
Class 1      
Employer   Employee  
Earnings per week Rate payable Earnings per week Rate payable
£0.01 - £166.00 Nil £0.01 - £166.00 Nil
Over £166.00 13.8% £166.01 - £962.00 12%
 
Over £962.00 2%
Class 1A and 1B (employers only) 13.8%    
Class 2 (self employed) £3.00 per week (small profits threshold £6,365)
Class 3 (voluntary) £15.00 per week
Class 4 (self-employed) Profits up to £8,632 0%
  Profits from £8,632 to £50,000 9%
  Profits above £50,000 per annum
2%

The first £3,000 of employer's liability relieved by the employment allowance. From 6 April 2020, the employment allowance will only apply to companies with an NIC bill of less than £100,000. No employers NIC for employees aged under 21 (and apprentices up to age 25) on earnings up to £962 per week (the upper earnings limit).

Apprenticeship Levy at 0.5% payable on annual pay bills in excess of £3m, net of £15,000 annual allowance.

INDIVIDUAL SAVINGS ACCOUNTS
  2019/20 2018/19
Cash and shares combined limit £20,000 £20,000
Lifetime ISA £4,000 £4,000
Junior ISA £4,368 £4,260

Note: Help To Buy ISA - deposit limit £1,200, plus up to £200 per month.

TAX EFFICIENT SAVINGS AND INVESTMENTS
Maximum investment 2019/20 2018/19 Note
Seed enterprise investment scheme (SEIS) £100,000 £100,000 A, F
Venture capital trusts (VCTs) £200,000 £200,000 B
Enterprise investment scheme (EIS) £1m £1m B, D, E
Social investment tax relief £1m £1m B, C

A Income tax relief at 50%.
B Income tax relief at 30%.
C £1.5m for enterprises up to 7 years old.
D Up to £2m for 'knowledge - intensive' companies.
E Capital gains tax deferral on gains reinvested in EIS qualifying investments.
F Capital gains tax exemption on 50% of gains reinvested in SEIS qualifying investments.

PROPERTY STAMP TAXES
Residential England & NI Scotland Wales
Price/premium payable SDLT LBTT LTT
£1 - £125,000 Nil Nil Nil
£125,001 - £145,000 2% Nil Nil
£145,001 - £180,000 2% 2% Nil
£180,001 - £250,000 2% 2% 3.5%
£250,001 - £325,000 5% 5% 5%
£325,001 - £400,000 5% 10% 5%
£400,001 - £750,000 5% 10% 7.5%
£750,001 - £925,000 5% 12% 10%
£925,001 - £1.5m 10% 12% 10%
Over £1.5m 12% 12% 12%

3% supplement to above rates for second properties and all purchases above £40,000 by corporates, discretionary and certain other trustees.
Residential properties in England and Northern Ireland purchased by non-natural persons (enveloped properties) for more than £500,000 incur a flat 15% SDLT rate unless a relief is available.
First time buyer exemption from SDLT for purchases up to £300,000 and for the first £300,000 of purchases up to £500,000.
First time buyer relief from LBTT for the first £175,000 of relevant property purchases. 

Residential leases

England and Northern Ireland - 1% on present value of rents above £125,000,
nil in Wales and generally exempt in Scotland

Non residential/mixed use England & NI Scotland Wales
Price/premium payable SDLT LBTT LTT
0 - £150,000 Nil Nil Nil
£150,001 - £250,000 2% 3% 1%
£250,001 - £350,000 5% 3% 5%
£350,001 - £1m 5% 4.5% 5%
Over £1m 5% 4.5% 6%
Non residential/mixed leases      

England and Northern Ireland - 1% on present value of rents £150,001 to £5m, 2% above £5m.
Scotland - 1% on present value of rents over £150,000.
Wales - 1% on present value of rents £150,000 to £2m, 2% above £2m.
Note: The time limit for filing a stamp duty land tax return and paying the stamp duty land tax liability is reduced from 30 to 14 days for transactions with an effective date after 1 March 2019. 

ANNUAL TAX ON ENVELOPED DWELLINGS
Residential property value 2019/20 2018/19
£500,001 - £1m £3,650 £3,600
£1m - £2m £7,400 £7,250
£2m - £5m £24,800 £24,250
£5m - £10m £57,900 £56,550
£10m - £20m £116,100 £113,400
Over £20m £232,350 £226,950

Note: Prior to 1 April 2019, gains on disposals of property within the Annual Tax on Enveloped Dwellings regime subject to capital gains tax at up to 28%.

CORPORATION TAX AND DIVERTED PROFITS TAX
  2019/20 2018/19 Note
Corporation tax 19% 19%  
Loans to participators 32.5% 32.5%  
Restitution interest payments
corporation tax rate
45% 45% A
Diverted profits tax 25% 25% B

A Withheld at source.
B Applies to profits of large entities diverted from the UK as a result of an avoided permanent establishment or transactions which lack economic substance.

PATENT BOX
  2019/20 2018/19 Note
Effective rate of tax on qualifying profits 10% 10% A

A Nexus based regime operates from 1 July 2016. Previous regime available until 2021 if opt in election made for patents registered by 30 June 2016.

RESEARCH AND DEVELOPMENT TAX RELIEF
  2019/20 2018/19 Note
SME enhanced deduction scheme 130% 130% A
SME cash credit for R&D loss surrendered 14.5% 14.5% B
Large company above the line scheme credit 12% 12% C

A Additional (enhanced) tax deduction available for qualifying R&D expenditure.
B From 1 April 2020, the payable R&D tax credit in any tax year is restricted to three times the company's total PAYE income tax and NIC liability for the year.
C Taxable credit available on qualifying R&D expenditure.

CAPITAL ALLOWANCES
  2019/20 2018/19 Note
Plant and machinery      
Annual investment allowance 100% 100% A
Long life assets and integral features 6% 8% B
Other assets 18% 18% B
First year allowances 100% 100% C
Cars: CO2 emissions (g/km)      
50 or less 100% 100%  
51 to 110  18% 18% B
Over 110 6% 8% B
Structures and buildings 2%  2%  D

A Maximum annual investment allowance £1m pa from 1 January 2019 to 31 December 2020 (£200,000 pa to 31 December 2018 and from 1 January 2021).
B Reducing balance.
C Available for: research and development (no time limit); enterprise zone (assisted areas) until designated dates between 31 March 2020 and 16 March 2024; energy saving and environmentally beneficial (water efficient) technologies until 31 March 2020/5 April 2020; brand new low emission cars and gas refuelling stations until 31 March 2021; zero-emission goods vehicles until 31 March 2021/5 April 2021; and electric vehicle charge points until 31 March 2023/5 April 2023.
D Expenditure on non residential structures and buildings on construction contracts entered into on or after 29 October 2018.

VALUE ADDED TAX
  2019/20 Note
Standard rate 20%  
Reduced rate 5%  
Annual turnover limit for registration £85,000 A
Annual cash accounting upper limit £1,350,000  
EC Sales List reporting threshold Nil  
Intrastat reporting    
Arrivals threshold £1,500,000  
Dispatches threshold £250,000  

A Taxable turnover is measured by reference to the last 12 months or next 30 days.

 DIGITAL SERVICES TAX
From 1 April 2020, a new 2% tax on the revenues of certain digital
businesses with global in scope revenues exceeding £500m pa will
be introduced. It will apply to business activities comprising search engines,
social media platforms, and online market places. 

STAMP DUTY
Consideration on shares over £1,000 0.5%
AUTHORISED MILEAGE RATES
    Per mile
Private cars and vans First 10,000 miles in the tax year 45p
  Additional miles 25p
  Each qualifying passenger 5p
Motor cycle   24p
Cycle   20p
CAR AND FUEL SCALE BENEFITS
Car benefit Percentage (see below) of list price
Fuel benefit £24,100
CO2 emissions (g/km): Diesel Petrol
0 - 50 20% 16%
51 - 75 23% 19%
76 - 94 26% 22%
Each additional 5 Further 1% Further 1%
Diesel 145 and over/Petrol 165 and over 37% 37%

Notes:
Benefit for Electric Vehicles 16%.
Diesel vehicles meeting the RDE2 standard will be exempt from diesel supplement and the above petrol rates apply for such vehicles.