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Income tax and personal savings

The Chancellor announced a bringing forward of the planned increases in the personal allowance and the higher rate threshold for income tax.

Income tax rates and bands

2019/20		2018/19
Band £	Rate %	Band £	Rate %
0 - 37,500	20	0 - 34,500	20
37,501 - 150,000	40	34,501 - 150,000	40
Over 150,000	45	Over 150,000	45

Savings income

Savings Allowance	2019/20	2018/19
Basic rate	£1,000	£1,000
Higher rate	£500	£500

A starting rate for savings band of £5,000 at 0% may be available unless taxable non-savings income exceeds the starting rate band.

Dividend income

Allowance/Rate	2019/20	2018/19
Dividend allowance	£2,000	£2,000
Dividend ordinary rate	7.5%	7.5%
Dividend upper rate	32.5%	32.5%
Dividend additional rate	38.1%	38.1%

Personal allowances

	2019/20	2018/19
Personal allowance	£12,500	£11,850
Personal allowance income limit	£100,000	£100,000
Marriage allowance Transferable between certain spouses where neither pay tax above the basic rate	£1,250	£1,190
Married couple's allowance (MCA) (relief given at 10%) Either partner born before 6 April 1935	£8,950	£8,695
- minimum amount	£3,450	£3,360
- income limit	£29,600	£28,900
Blind person's allowance	£2,450	£2,390

Scottish income tax rates and bands

Rates and bands for 2019/20 will be announced in the Scottish Budget.

2018/19
Band £	Rate %
0 - 2,000	19
2,001 - 12,150	20
12,151 - 31,580	21
31,581 - 150,000	41
Over 150,000	46

Welsh income tax rates

From 6 April 2019, the UK government will reduce the basic, higher and additional rates of income tax paid by Welsh taxpayers by 10%, and three Welsh rates of income tax will then be added to the reduced UK rates. The Welsh government proposes to set the first Welsh rates at 10%.

Individual Savings Accounts (ISAs)

Individuals can invest in any combination of cash or stocks and shares up to the overall annual ISA subscription limit. However, a saver may only pay into a maximum of one Cash ISA, one Stocks and Shares ISA, one Innovative Finance ISA and one Lifetime ISA. The overall investment limit for 2019/20 is £20,000 (£4,368 for junior accounts).

Latest news

24 Apr 2024

Inheritance tax receipts hit a record high of £7.5 billion

Data published by HMRC has revealed that inheritance tax (IHT) receipts rose to a record high of £7.5 billion in the 2023/24 tax year.

23 Apr 2024

Small firms confused over upcoming import rules

The government has been accused of confusing small firms before new import rules on plant and food products are introduced, according to the Federation of Small Businesses (FSB).

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