Tax Card

TAX CARD

TAX RATES 2010/11

Davies Mclennon

Graham Davies

Tel: 0161 612 0077

Email: graham@daviesmclennon.co.uk

INCOME TAX ALLOWANCES

2009-10 2010-11
Personal Allowance (1) £6,475 £6,475
Income limit for Personal Allowance Not applicable £100,000
Personal Allowance for people aged 65-74 (1) (2) £9,490 £9,490
Personal Allowance for people aged 75 and over (1) (2) £9,640 £9,640
Married Couple’s Allowance (born before 6th April 1935 but aged under 75) (2) (3) (4) Not applicable Not applicable
Married Couple’s Allowance – aged 75 and over (2) (3) £6,965 £6,965
Income limit for age-related allowances £22,900 £22,900
Minimum amount of Married Couple’s Allowance £2,670 £2,670
Blind Person’s Allowance £1,890 £1,890
(1) From the 2010-11 tax year the Personal Allowance reduces where the income is above £100, 000 – by £1 for every £2 of income above the £100,000 limit. This reduction applies irrespective of age.


 (2) These allowances reduce where the income is above the income limit – by £1 for every £2 of income above the limit. For the 2008-09 and 2009-10 tax years they will never be less than the basic Personal Allowance or minimum amount of Married Couple’s Allowance. However, from the 2010-11 tax year the Personal Allowance for people aged 65 to 74 and 75 and over can be reduced below the basic Personal Allowance where the income is above £100,000.

(3) Tax relief for the Married Couple’s Allowance is given at the rate of 10 per cent.

(4) In the 2009-10 tax year all Married Couple’s Allowance claimants in this category will become 75 at some point during the year and will therefore be entitled to the higher amount of the allowance – for those aged 75 and over.

INCOME TAX RATES AND TAXABLE BANDS


2009-10 2010-11
Starting rate for savings: 10% £0-£2,440 £0-£2,440
Basic rate: 20% £0-£37,400 £0-£37,400
Higher rate: 40% Over £37,400 £37,401-£150,000
Additional rate: 50% Not applicable Over £150,000
The rates available for dividends for 2009-10 tax year is the 10 per cent ordinary rate and the 32.5 per cent dividend upper rate. For the 2010-11 tax year, as well as these rates there is a new dividend additional rate of 42.5 per cent.
RATES FOR
CAPITAL GAINS TAX


Tax Year Rate
2009-10 18%
2010-11
Basic Rate Taxpayers 18%
Higher Rate Taxpayers 18%
Trustees 18%
TAX-FREE ALLOWANCES FOR
CAPITAL GAINS TAX


2009-10 2010-11
Individuals, personal representatives and trustees for disabled people £10,100 £10,100
Other trustees £5,050 £5,050
Entrepreneurs’ Relief – lifetime allowance – Up to 22.6.10
- After 22.6.10		 £1m
£2m
£5m
Entrepreneurs’ Relief – effective tax rate 10% 10%

RATES AND ALLOWANCES NATIONAL INSURANCE CONTRIBUTIONS


£ per week 2009-10 2010-11
Lower earnings limit, primary Class 1 £95 £97
Upper earnings limit, primary Class 1 £844 £844
Upper accruals point £770 £770
Primary threshold £110 £110
Secondary threshold £110 £110
Employees’ primary Class 1 rate between primary threshold and upper earnings limit 11% 11%
Employees’ primary Class 1 rate above upper earnings limit 1% 1%
Class 1A rate on employer provided benefits (1) 12.8% 12.8%
Employees’ contracted-out rebate 1.6% 1.6%
Married women’s reduced rate between primary threshold and upper earnings limit 4.85% 4.85%
Married women’s rate above upper earnings limit 1% 1%
Employers’ secondary Class 1 rate above secondary threshold 12.8% 12.8%
Employers’ contracted-out rebate, salary-related schemes 3.7% 3.7%
Employers’ contracted-out rebate, money-purchase schemes 1.4% 1.4%
Class 2 rate £2.40 £2.40
Class 2 small earnings exception £5,075 per year £5,075 per year
Special Class 2 rate for share fishermen £3.05 £3.05
Special Class 2 rate for volunteer development workers £4.75 £4.85
Class 3 rate £12.05 £12.05
Class 4 lower profits limit £5, 715 per year £5, 715 per year
Class 4 upper profits limit £43, 875 per year £43, 875 per year
Class 4 rate between lower profits limit and upper profits limit 8% 8%
Class 4 rate above upper profits limit 1% 1%

(1) Class 1A NICs are calculated using the previous year’s benefit figure and the rate appropriate at the due date – July.

CORPORATION TAX RATES


Rates for financial years starting on 1 April 2009 2010
Small Companies Rate* 21%* 21%*
Small Companies Rate can be claimed by qualifying companies with profits at a rate not exceeding £300,000 £300,000
Marginal Small Companies Relief Lower Limit £300,000 £300,000
Marginal Small Companies Relief Upper Limit £1,500,000 £1,500,000
Marginal Small Company Relief (MSCR) Fraction 7/400 7/400
Main rate of Corporation Tax 28%* 28%*
Special rate for unit trusts and open-ended investment companies 20% 20%

*The main rate of Corporation Tax applies when profits (including ring fence profits) are at a rate exceeding £1,500,000, or where there is no claim to another rate, or where another rate does not apply.

INHERITANCE TAX THRESHOLDS



The Inheritance Tax threshold (or ?nil rate band’) is the amount up to which an estate will have no Inheritance Tax to pay.

If the estate – including any assets held in trust and gifts made within seven years of death – is more than the threshold, Inheritance Tax will be due at 40 per cent on the amount over the nil rate band.
From To Threshold/nil rate band
6 April 2009 5 April 2014 £325,000
6 April 2008 5 April 2009 £312,000
6 April 2007 5 April 2008 £300,000
6 April 2006 5 April 2007 £285,000

STAMP DUTY LAND TAX RATES FOR RESIDENTIAL PROPERTY



Residential land or property SDLT rates and thresholds


Purchase price/lease premium or transfer value SDLT rate
Up to £125,000 Zero
Over £125,000 to £250,000 1%
Over £250,000 to £500,000 3%
Over £500,000 4%

If the value is above the payment threshold, SDLT is charged at the appropriate rate on the whole of the amount paid. For example, a house bought for £130,000 is charged at 1 per cent, so £1,300 must be paid in SDLT. A house bought for £350,000 is charged at 3 per cent, so SDLT of £10,500 is payable.

For first time buyers the zero rate band is extended to £250,000 from 25 March 2010 for a limited period to 25 March 2012.

From April 2011 a new 5% rate will be introduced for property sales over £1m.

RATES AND ALLOWANCES TRAVEL


Approved mileage rates


From 2011/12 First 10,000 business miles in the tax year Each business mile over 10,000 in the tax year
Cars and vans 45p 25p
Motor cycles 24p 24p
Bicycles 20p 20p

PASSENGER PAYMENTS CARS AND VANS


5p per passenger per business mile for carrying fellow employees in a car or van on journeys which are also work journeys for them. Only payments specifically for carrying passengers count and there is no relief if you receive less, or nothing at all.

COMPANY CARS ADVISORY FUEL RATES FROM 1 DECEMBER 2009



These rates apply to all journeys on or after 1 December 2009 until further notice.

From the change on 1 December 2009, the revised rates will take effect from the specified date rather than one month later, allowing them to reflect fuel prices more quickly. For one month from the date of change, employers may use either the previous or new current rates, as they choose. Employers may therefore make or require supplementary payments if they so wish, but are under no obligation to do either.
Engine size Petrol Diesel LPG
1400cc or less 11p 11p 7p
1401cc to 2000cc 14p 11p 8p
Over 2000cc 20p 14p 12p

VALUE ADDED TAX (VAT)


From 4 Jan 2011 1 Jan 2010
Standard rate 20% 17.5%
VAT fraction 1/6 7/47
Reduced rate 5% 5%
Current Turnover Limits
Registration – last 12 months or next 30 days over £70,000 from 1 April 2010
Deregistration – next 12 months under £68,000 from 1 April 2010
Annual Accounting Scheme £1,350,000
Cash Accounting Scheme £1,350,000
Flat Rate Scheme £150,000
This Tax Card was prepared immediately after the Chancellor’s Budget Statement 24 March 2010 – based on official press releases and supporting documentation. The Budget proposals are subject to amendment before the Finance Act receives Royal Assent. The information on this card is for guidance only, and professional advice should be obtained before acting on any information contained herein. No responsibility can be accepted by the publishers or the distributors for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.

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