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Tax Card 2024/25

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Tax Card 2024/25

Tax Card 2024/25

INCOME TAX ALLOWANCES

2024/25 2023/24
Personal allowance* £12,570 £12,570
Personal savings allowance

  • Basic-rate taxpayer
  • Higher-rate taxpayer
  • Additional-rate taxpayer
£1,000

£500

£0

£1,000

£500

£0

Dividend allowance at 0% £500 £1,000
Marriage/civil partner transferable allowance** £1,260 £1,260
Trading and property allowance*** £1,000 £1,000
Rent-a-room allowance £7,500 £7,500
Blind person’s allowance £3,070 £2,870

* The personal allowance is reduced by £1 for each £2 of income from £100,000 to £125,140.

** Any unused personal allowance may be transferred to a spouse or civil partner, where the recipient is not liable to higher or additional-rate tax.

*** Landlords and traders with gross income from each of these sources in excess of £1,000 can deduct the allowance from their gross income as an alternative to claiming expenses.

INCOME TAX BANDS AND RATES

2024/25 2023/24
Starting rate of 0% on savings up to*: £5,000 £5,000
Basic-rate band £12,571 to £50,270 £12,571 to £50,270
Higher-rate band £50,271 to £125,140 £50,271 to £125,140
Additional-rate band Above £125,140 Above £125,140
Basic-rate 20% 20%
Higher-rate 40% 40%
Additional-rate 45% 45%
Dividend basic-rate 8.75% 8.75%
Dividend higher-rate 33.75% 33.75%
Dividend additional-rate 39.35% 39.35%

* The starting rate does not apply if non-savings taxable income exceeds the starting rate limit. Every £1 of other income above the personal allowance reduces the starting rate ‘band’ by £1.

Income tax in Scotland

2024/25 2023/24
Band Taxable income Rate Taxable income Rate
Starter* £12,571 – £14,876 19% £12,571 – £14,732 19%
Basic £14,877 – £26,561 20% £14,733 – £25,688 20%
Intermediate £26,562 – £43,662 21% £25,689 – £43,662 21%
Higher £43,663 – £75,000 42% £43,663 – £125,140 42%
Advanced** £75,001 – £125,140 45% N/A N/A
Top** Above £125,140 47% Above £125,140 47%

* Assumes individual is in receipt of a personal allowance.

** The personal allowance is reduced by £1 for each £2 of income from £100,000 to £125,140.

VEHICLE AND FUEL BENEFITS-IN-KIND 

The taxable benefit-in-kind is calculated as a percentage of the car’s UK list price. The percentage depends on the car’s CO2 emissions in grams per kilometre (g/km).

CO2 emissions (g/km) Electric range (miles) Appropriate percentage *
0 n/a 2%
1 – 50 130 and over 2%
1 – 50 70 – 129 5%
1 – 50 40 – 69 8%
1 – 50 30 – 39 12%
1 – 50 Under 30 14%
51 – 54 n/a 15%
Over 54 n/a + 1% for every 5g/km up to 37%

* Diesel vehicles not meeting the RDE2 standard will be liable to a 4% surcharge, up to a maximum of 37%.

The list price is on the day before first registration, including most accessories, and is reduced by any employee’s capital contribution (max £5,000) when the car is first made available. Where the cost of all fuel for private use is borne by the employee, the fuel benefit is nil. Otherwise, the fuel benefit is calculated by applying the car benefit percentage to the car fuel benefit multiplier (below).

Company car fuel 2024/25 2023/24
Car fuel benefit multiplier £27,800 £27,800
Company vans* 2024/25 2023/24
Van benefit charge £3,960 £3,600
Van fuel benefit charge £757 £688

* Applies where private use is more than home-to-work travel. Payments by employees for private use may reduce these benefits-in-kind. Zero-emission vans have a benefit value of £0.

TAX-FREE MILEAGE ALLOWANCES

Cars and vans (inc. electric vehicles) First 10,000 business miles 45p
Thereafter 25p
Motorcycles 24p
Bicycles 20p
Business passenger 5p

The tax-free business mileage allowance rates apply for qualifying business journeys incurred by employees using their own vehicles over the course of the tax year.

For National Insurance purposes, a 45p rate might apply for all business miles incurred by cars and vans.  

CAPITAL GAINS TAX

2024/25 2023/24
Main rates Individual basic-rate 10% 10%
Individual above basic-rate 20% 20%
Trusts and estates 20% 20%
Surcharge – for gains on chargeable residential property and carried interest 8% 8%
Annual exemption Individuals £3,000 £6,000
Trusts £1,500 £3,000
Business asset disposal relief Applicable rate 10% 10%
Lifetime limit £1m £1m
Investors’ relief Applicable rate 10% 10%
Lifetime limit £10m £10m

INHERITANCE TAX

2024/25 2023/24
Nil-rate band limit* £325,000 £325,000
Main residence nil-rate band** £175,000 £175,000
Combined threshold limit for married couples and civil partners, including main residence nil-rate band £1m £1m
Business property relief and agricultural property relief 50% or 100% 50% or 100%

* Up to 100% of any unused part of a deceased person’s nil-rate band can be claimed by the surviving spouse/civil partner on their death. This also applies to the main residence nil-rate band, albeit the main residence nil-rate is subject to the taper withdrawal below.

** For estates in excess of £2m the RNRB is reduced by £1 for every £2 of value by which the estate exceeds the taper threshold.

Tax rates

2024/25 2023/24
Main rate 40% 40%
Chargeable on lifetime transfers 20% 20%
Transfers on or within seven years of death* 40% 40%
Reduced rate** 36% 36%

* All lifetime transfers not covered by exemptions and made within seven years of death will be added back into the estate for the purposes of calculating the tax payable. This may then be reduced as shown in the table below.

** Applies if 10% or more of net chargeable estate is left to certain registered charities.

Years before death 0 – 3 3 – 4 4 – 5 5 – 6 6 – 7
Tax reduced by 0% 20% 40% 60% 80%

UK COMPANY TAXATION

Financial year from 1 April 2024/25 2023/24
Corporation tax main rate 25%* 25%*
Loans to participators 33.75% 33.75%
Diverted profits tax 31% 31%
Small profits rate 19% 19%
Lower threshold £50,000 £50,000
Upper threshold £250,000 £250,000

*A tapered rate applies to profits falling between £50,000 and £250,000 in 2024/25.

MAIN CAPITAL ALLOWANCES 

Initial allowances

Annual investment allowance: on first £1m (excludes cars) 100%
First-year allowance: special-rate pool 50%
First-year allowance: including new and unused electric and zero-emission goods vehicles 100%
Full expensing relief: plant and machinery 100%

Writing-down allowances 

Plant and machinery main-rate expenditure 18%
Plant and machinery special-rate expenditure 6%
Cars 1 – 50g/km 18%
More than 50g/km 6%
Structures and buildings allowance – straight-line relief 3%*

*An enhanced structure and buildings allowance of 10% is available in qualifying freeport tax sites.

VAT

From 1 April 2023 Rate VAT fraction
Standard rate 20% 1/6
Reduced rate 5% 1/21

 Taxable turnover limits

From 1 April 2024 2023
Registration (last 12 months or next 30 days) over £90,000 £85,000
Deregistration (next 12 months) under £88,000 £83,000
Annual and cash accounting schemes turnover limit £1.35m £1.35m
Flat-rate scheme turnover limit £150,000 £150,000

RESEARCH AND DEVELOPMENT (R&D)

Revenue expenditure – SMEs 86%
Capital expenditure – all companies 100%
SME company R&D payable credit 10%*
R&D expenditure credit (RDEC) 20%**

* 14.5% for small companies spending 40% of expenditure on R&D.

** A corporation tax deduction is applied to this.

TAX-EFFICIENT INVESTMENTS

Annual investment limit 2024/25 2023/24
ISA £20,000 £20,000
Lifetime ISA* £4,000 £4,000
Help-to-buy ISA (existing savers only) Up to £200 per month
Junior ISA and child trust fund £9,000 £9,000
Venture capital trust at 30% £200,000 £200,000
Enterprise investment scheme at 30%** £1m £1m
Seed EIS (SEIS) at 50% £200,000 £200,000

* Reduces ISA limit by amount invested in Lifetime ISA.

** Up to £2m in a knowledge-intensive company.

REGISTERED PENSIONS

2024/25 2023/24
Lifetime allowance limit* None £1,073,100
Money purchase annual allowance £10,000 £10,000
Annual allowance limit* £60,000 £60,000
Minimum age for accessing benefits 55 55
Maximum tax-free pension lump sum 25% of pension fund value

* The lifetime allowance will end in April 2024 and will be replaced by new allowances. For most people, the lump sum allowance (LSA) will limit the tax-free cash you can get from your pension to £268,275. The lump sum and death benefit allowance (LSDBA) will limit the total amount of tax-free cash you can get in your lifetime and when you die to £1,073,100, in most cases. An overseas transfer allowance (OTA) will also apply if you transfer your pension abroad.

** Tapered at a rate of 50% of excess income down to £10,000 if threshold income over £200,000 and adjusted income over £260,000. Restrictions can apply based on net-relevant earnings. For 2022/23 it would be tapered to a minimum of £4,000.

Subject to certain conditions, the unused amount of the annual allowance can be carried forward up to three years and used once the current year annual allowance has been fully utilised.

NATIONAL INSURANCE

Class 1
Weekly earnings Employee rate Weekly earnings Employer rate
Up to £242 Nil* Up to £175 Nil
Over £242 – £967 8% Over £175 – £967 13.8%**
Over £967 2% Over £967 13.8%
Over state pension age 0% Over state pension age 13.8%

* Entitlement to contribution-based benefits are retained for earnings between £123 and £242 per week.

** 0% for staff under 21 and apprentices under 25 on earnings up to £967 a week, or for new employees in freeport tax sites on earnings up to £481 a week.

Class 1A
On relevant benefits, including car and fuel benefits 13.8%
Class 2
Self-employed above lower profits limit £0
Lower profits limit Not applicable
Class 3
Voluntary £17.45 a week
Class 4*
From 6 April: Self-employed on profits £12,570-£50,270 6%
Over £50,270 2%

* Exemption applies if the state retirement age is reached by 6 April 2024.

Employment allowance

Per employer, per year £5,000*

* One claim only for companies in a group or under common control. Not available where the director is the only employee paid earnings above the secondary threshold for class 1 NICs. Limited to employers with an employer NICs bill below £100,000 in the previous tax year.

Apprenticeship levy

A levy of 0.5% applies where the pay bill exceeds £3m. There is an allowance of £15,000. Further conditions apply, so please consult with us.

STAMP DUTY

Consideration on shares over £1,000 0.5%

PROPERTY TAXES 

Incremental rates of tax are only payable on the part of the property price within each band. An extra 3% rate (6% in Scotland) applies to purchases of additional residential property above £40,000 and all corporate residential properties.

England & Northern Ireland: Stamp duty land tax

On transfer of residential property*                      On transfer of non-residential property
£0 – £250,000 0% £0 – £150,000 0%
Over £250,000 – £925,000 5% Over £150,000 – £250,000 2%
Over £925,000– £1.5m 10% Above £250,000 5%
Above £1.5m 12%

* First-time buyers pay nothing on the first £425,000 for properties up to £625,000. A 5% rate will also apply between £425,000 and £625,000.

For residential purchases by ‘non-natural persons’ over £500,000 a rate of 15% applies, subject to certain exclusions.

Scotland: Land and buildings transaction tax

On transfer of residential property*                     On transfer of non-residential property
£0 – £145,000 0% £0 – £150,000 0%
Over £145,000 – £250,000 2% Over £150,000 – £250,000 1%
Over £250,000 – £325,000 5% Above £250,000 5%
Over £325,000 – £750,000 10%
Above £750,000 12%

* First-time buyers pay nothing on the first £175,000.

Wales: Land transaction tax

On transfer of residential property                     On transfer of non-residential property
£0 – £225,000 0% £0 – £225,000 0%
Over £225,000 – £400,000 6% Over £225,000 – £250,000 1%
Over £400,000 – £750,000 7.5% Over £250,000 – £1m 5%
Over £750,000 – £1.5m 10% Above £1m 6%
Above £1.5m 12%

Residential property developer tax

On annual profits in excess of £25m 4%

IMPORTANT NOTICE

These rates and allowances are based on fiscal Statement and Budget announcements made by the UK and Northern Ireland, Scottish and Welsh Governments and are for information only.

All information is subject to change before 6 April 2024 and confirmation by the respective governments. The above must not be considered advice and no warranty is given for the accuracy or completeness of the details. Professional advice should be sought before making any decisions.

Rates apply to the UK and Northern Ireland unless stated otherwise.