- Home
- About us
- Our People
- Starting out
- Our Services
- Resources
- Calculators
- Business
- Starting a business
- Employed or self employed?
- Buying a business
- Initial costs of starting in business
- Proving your credentials to investors
- The tax system for the self employed
- Business deductions
- Claiming expenses
- Choosing your accounting date
- Buying a franchise
- The construction industry
- Preparing your business plan
- Essential record keeping
- The national minimum wage and the national living wage
- Working from home
- Insuring your business
- Tax planning for businesses
- Limited companies
- The tax system for companies
- Forming a limited company
- Pros and cons of limited companies
- Buying a company 'off the shelf'
- Tax and the company car
- Company bonus or dividend?
- Tax saving strategies
- Interest and tax payments
- Companies Act 2006
- A company's members
- A more in depth look at the act
- Accounting records
- An auditor's rights to information
- An historical record of the key changes
- Appointment of auditors
- Appointment of directors
- Changing the company name
- Choosing a name for your company
- Directors transactions requiring members approval
- Directors' liabilities
- Directors' report
- Directors' service contracts
- Do you need an audit?
- Filing of accounts and late filing penalties
- Financial year
- General duties of directors
- Group accounts
- Loans to directors
- Records of directors meetings
- Registered office
- Related director agreements
- Shares and share capital
- Signing of accounts: directors and auditors
- Forming a limited company
- Companies House - forms you need to know about
- The law and directors' responsibilities
- Statutory records
- The company secretary
- Getting the company struck off
- Running your business
- Partnerships
- Your employees
- Selling your business
- Starting a business
- Personal
- Tax
- Spring Budget 2021
- Tax rates and allowances
- Key dates and deadlines
- Income tax
- Corporation tax
- Inheritance tax
- Capital gains tax
- Value added tax
- National insurance contributions
- Residential property letting
- Main capital allowances
- Patent box
- Business deductions
- Penalties for late returns
- Trusts and settlements
- Non domiciled individuals
- Green travel allowances
- Mileage allowances
- Vehicle benefits
- Vehicle duties
- Pension premiums
- EIS SEIS and VCT
- ISAs
- Stamp and property taxes
- Air passenger duty rates
- Landfill tax
- Charitable giving
- Annual tax on enveloped dwellings
- Diverted profits tax
- Tax credits
- State pension
- VAT
- An introduction to VAT
- Value added tax
- Bad debt relief
- Issuing VAT invoices
- Recovering VAT on staff expenses
- Fuel scale charges
- When to add VAT
- Deregistering from VAT
- Cash accounting scheme
- Flat rate scheme
- Annual accounting scheme
- VAT dos and don’ts
- VAT inspections
- How to survive the enforcement powers
- Group VAT registration
- VAT Mini One Stop Shop (MOSS)
- Reverse charge VAT for construction services
- PAYE and NI
- IR35
- Tax and business calendar
- Budgets and Statements archive
- News desk
- Contact Us
Upcoming changes
These rates were confirmed by Chancellor Philip Hammond in Budget 2018 and are subject to future change should the UK fail to reach an agreement with the EU over its exit.
Personal
Income tax bands and rates
The bands and rates at which people in England, Northern Ireland, Wales pay income tax will change for 2019/20, but it will be business as usual for taxpayers in Scotland.
The following income tax bands and thresholds will be in place from 6 April 2019:
Table 1: England, Northern Ireland & Wales
| Band | Taxable income 2019/20 | Rate |
| Personal allowance | Up to £12,500 | 0% |
| Basic rate | £12,501 to £50,000 | 20% |
| Higher rate* | £50,001 to £150,000 | 40% |
| Additional rate* | Above £150,000 | 45% |
Table 2: Scotland
| Band | Taxable income 2019/20 | Rate |
| Personal allowance | Up to £12,500 | 0% |
| Starter rate | £12,501 to £14,549 | 19% |
| Basic rate | £14,550 to £24,944 | 20% |
| Intermediate rate | £24,945 to £43,430 | 21% |
| Higher rate* | £43,431 to £150,000 | 41% |
| Top rate* | Above £150,000 | 46% |
* The personal allowance is reduced by £1 for each £2 of income from £100,000 to £125,000 (2018/19, £123,700).
Table 3: Tax on dividends (throughout the UK)
| Dividend allowance | £2,000 |
| Basic rate | 7.5% |
| Higher rate | 32.5% |
| Additional rate | 38.1% |
ISAs
The £20,000 limit may also be used to invest in a lifetime ISA, which has a maximum allowance in 2019/20 of £4,000.
Pensions
The lifetime allowance, which is the maximum amount an individual can draw from pensions without incurring extra tax charges, rises to £1.055 million from 6 April 2019.
Capital gains tax
The capital gains tax (CGT) annual exempt amount for individuals rises from £11,700 to £12,000 from 6 April 2019. At the same time, the annual exemption for trusts increase from £5,850 to £6,000.
Business
Corporation tax
| Financial year from 1 April | 2019 | 2018 |
| Corporation tax rate | 19% | 19% |
| Loans to participators | 32.5% | 32.5% |
The intention to cut the rate of corporation tax to 17% in 2020/21 remains on course.
Auto-enrolment
From 6 April 2019, the minimum employer contribution towards an employee’s workplace pension will increase from 2% to 3%, while eligible employees will see their minimum contributions increase from 3% to 5% of their pensionable earnings.
These contributions are mandatory for workers aged between 22 and state pension age, earning more than £10,000 a year.
National living wage rates
National living wage rates for all ages and apprentices are increasing from 1 April 2019.
2019/20 rates
- Over-25s – £8.21
- 21 to 24 – £7.70
- 18 to 20 – £6.15
- Under-18s – £4.35
- Apprentice – £3.90*
*If under 19 or in the first year of apprenticeship.
VAT
| From 1 April | 2019 | 2018 |
| Standard rate | 20% | 20% |
| VAT fraction | 1/6 | 1/6 |
| Reduced rate e.g. on domestic fuel | 5% | 5% |
| VAT fraction | 1/21 | 1/21 |
Taxable turnover limits
| From 1 April | 2019 | 2018 |
| Registration (last 12 months or next 30 days) over | £85,000 | £85,000 |
| Deregistration (next year) under | £83,000 | £83,000 |
| Registration for distance selling into the UK (last 12 months or next 30 days) over | £70,000 | £70,000 |
| Annual and cash accounting schemes turnover limit | £1.35m | £1.35m |
| Flat rate scheme turnover limit | £150,000 | £150,000 |
The VAT-registration threshold is to stay at £85,000 until April 2022.
A new VAT reverse charge for construction businesses will come into effect on 1 October 2019.
The reverse charge could put the onus on customers who buy supplies or construction services to account for VAT and report it to HMRC instead of the supplier.