2016/17 Income Tax

  2016-17 2015-16
Basic Rate Band – income up to £32,000 £31,785
Starting rate for savings 0%* 0%*
Basic rate 20% 20%
Dividend ordinary rate 7.5%** 10%
Higher Rate Band – income over £32,000 £31,785
Higher rate 40% 40%
Dividend upper rate 32.5% 32.5%
Additional Rate – income over £150,000 £150,000
Additional rate 45% 45%
Dividend upper rate 38.1% 37.5%
Starting rate limit (savings income) £5,000* £5,000*

For 2016/17 Scottish taxpayers effectively subject to the same income tax rates as rest of UK.

* If an individual’s taxable non-savings income exceeds starting rate limit, then starting rate limit for savings will not be avilable for savings income.  For 2016/17, £1,000 of saving income for basic rate raxpayers (£500 for higher rate) may be tax-free.

** For 2016/17 first £5,000 of dividens tax-free.

 

Personal allowances (PA)

  2016-17 2015-16
Born after 5th April 1938 £11,000 £10,600
Born before 6th April 1938 £11,000* £10,660*

 

Married couple’s allowance (MCA) (relief 10%)

  2016-17 2015-16
Either partner born before 6th April 1935 £8,355* £8,355*

 

Transferable Tax Allowance

  2016-17 2015-16
for certain married couples (relief 20%) £1,100 £1,060

* Allowances are reduced by £1 for every £2 that adjusted net income exceeds £27,700 to a minimum PA of £11,000 (£10,600) and to a minimum MCA of £3,220.  Where adjusted net income exceeds £100,000, PA is reduced in the same way until it is nil regardless of the individual’s date of birth.

 

Tax Shelters

  2016-17 2015-16
Venture Capital Trust up to £200,000 £200,000
Enterprise Investment Scheme 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

 

Tax Free Savings Accounts

  2015/16
ISA Subscription Limit £15,240
Junior ISA and CTF subscription limit £4,080