Tax Rates & Tables

* Income limits apply to age allowances so that these additional allowances are not beneficial where the individual's income for the year exceeds these limits.

With effect from 6th April 2003 this benefit is generally paid direct to the claimant's bank account rather than as a credit against tax liabilities. Claimants' income is taken into account in assessing the levels of payment to which they are entitled with credits being progressively reduced at a 37% rate once income exceeds the basic threshold of £5,060 per annum. See Tables below for the rates of the various tax credits now in force.

Working and Child Tax Credits,

Child Benefit and Guardian’s Allowance.

Car Fuel benefits

NOTE: from 2003/2004 the Car Fuel Scale charge is abolished and henceforward it is computed according to the C02 emissions figure for the car against a standard charge figure of £14,400. Thus for a car with a C02 emissions level figure of 175 gm/km the table gives a rate of 19% arriving at a taxable income figure of £2736 for 2003/2004

Fixed Profit Car Scheme – Inland Revenue Authorised Mileage Rates

The tax free mileage rates available for employees using their own cars and cycles on their employer’s business are as follows:-

The tax free rates for cars and cycles which apply from 6 April 2002 are as follows:

* "Tangible Moveable Property" is not chargeable to CGT where the sales proceeds are less that the limit. Where the limit is exceeded gains are restricted to 5/3 of the difference between the proceeds and the limit.

** For individuals gains are taxed as the top slice of income. Thus, from 5/4/2000 the lowest possible rate is 10%, with the 20% rate available up to the basic rate threshold for each year. Trusts and personal representatives are taxed at 34% on all gains above the annual exemption.

*** Personal representatives are entitled to the annual exemption for the year of death and the following two years.

Capital Gains Tax Reliefs

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Capital Gains Tax - Retirement Relief
Disposals after	Minimum Age	100% relief on gains up to	50% relief on gains between	Maximum amount of relief
27/11/95	50	£250000	£250000-£1000000	£625000
5/4/99	50	£200000	£200000-£8000000	£500000
5/4/2000	50	£150000	£150000-£600000	£375000
5/4/2001	50	£100000	£100000-£400000	£250000
5/4/2002	50	£50000	£50000-£200000	£125000
5/4/2003	N/A	£Nil	£Nil	£Nil

Item	2003-04	2004-05
Lower earnings limit, primary Class 1	£77 per week	£79 per week
Upper earnings limit, primary Class 1	£595 per week	£610 per week
Primary threshold	£89 per week	£91 per week
Secondary threshold	£89 per week	£91 per week
Employees’ primary Class 1 rate	11% of £89.01 to £595 per week 1% above £595 per week	11% of £91.01 to £610 per week 1% above £610 per week
Employees’ contracted-out rebate	1.6 per cent	1.6 per cent
Married women’s reduced rate	4.85% of £89.01 to £595 per week 1% above £595	4.85% of £91.01 to £ 610 per week 1% above £610
Employers’ secondary Class 1 rate	12.8% above £89 per week	12.8% above £91 per week
Employers’ contracted-out rebate, salary related schemes	3.5 per cent	3.5 per cent
Employers’ contracted-out rebate, money-purchase schemes	1.0 per cent	1.0 per cent
Class 2 rate	£2.00 per week	£2.05 per week
Class 2 small earnings exception	£4,095 per year	£4,215 per year
Special Class 2 rate for share fishermen	£2.65 per week	£2.70 per week
Special Class 2 rate for volunteer development workers	£3.85 per week	£3.95 per week
Class 3 rate	£6.95 per week	£7.15 per week
Class 4 lower profits limit	£4,615 per year	£4,745 per year
Class 4 upper profits limit	£30,940 per year	£31,720 per year
Class 4 rate	8% of £4,615 to £30,940 per year 1% above £30,940 per year	8% of £4,745 to £ 31,720 per year 1% above £31,720 per year

Where there is a gift of an asset or a transfer of assets between "connected persons" (basically relatives - defined as husbands, wives, brothers sisters, uncles, aunts, nephews and nieces, ancestors and descendants) an election may be made to transfer the asset to the transferee at a no-gain/n loss result for capital gains tax purposes. Such claims may be made in respect of "business assets" (as defined) or where the assets are being transferred to a Discretionary trust. Specific advice will be needed where such transactions are being contemplated.

Where a qualifying asset is sold, (broadly land, buildings, goodwill, fixed plant and machinery, ships aircraft satellites and hovercraft, and various types of agricultural quotas), and the sales proceeds are reinvested in new qualifying assets, subject to specific qualifying conditions the capital gain arising on the disposal may be deferred until the "replacement asset" is eventually disposed of.

Capital gains can be deferred by reinvestment in the acquisition of qualifying shares in companies which are eligible for Enterprise Investment Scheme status. The acquisition must be by subscription and only the amount of the capital gain needs to be invested to defer the gains. The qualifying conditions are quite rigorous and the reinvestment must be made within the time window of one year before or three years after the gains arising. Similar deferral reliefs are available for investment in qualifying Venture Capital Trust but the time limits are narrower and the qualifying company status conditions are rather more rigorous. Specialist advice must be sought as in any tax related planning decisions,

The sale of one own private home is normally exempted from Capital Gains Tax but the exemption should never be taken for granted. The relief available is for the disposal of the private residence and the garden or grounds which go with it but there are specific conditions about the size of the grounds and also where the home has been used for non-residential purposes or part is being sold off separately there can be problems.

UK TAX Rates and allowances- a summary

Working and Child Tax Credits,

Child Benefit and Guardian’s Allowance.

Car Fuel benefits

Fixed Profit Car Scheme – Inland Revenue Authorised Mileage Rates

Capital Gains Tax Reliefs