Skip to main content

  • Home
  • About Us
    • - Our Company
    • - Our Team
  • Services
    • - Financial Planning
    • - Mortgages
    • - Protection
    • - Retirement Planning
    • - Savings & Investments
    • - Wealth Management
    • - Business Protection
    • - Taxation
    • - Equity Release

    Professional Financial Planning is the process which aims to help you realise your ambitions - whatever they may be. As professional financial advisers we can help you make informed decisions about your financial future, short, medium and long term.Read More

    Mortgages are loans which are intended to help buyers purchase residential and commercial property. When an individual takes out a loan, the lender charges interest: the same is true of a mortgage.Read More

    Health Insurance is probably one of the most important types of insurance you can own. Without it, an illness or accident can have serious long-term financial implications for you and your family.Read More

    When you retire you still need food and shelter as an absolute minimum, but of course you will want to maintain the lifestyle to which you have become accustomed, so unless you can guarantee a large inheritance or windfall, then you need to provide yourself with a secure income for the rest of your life.Read More

    Often, people save for a specific reason and it's usually the safest way to build up a pot of money. It’s less risky than investing, but it offers limited growth. The most you'll earn on the money you save is the interest added. Saving is perfect for people who don’t want to take any risks with their money, and most savings accounts have easy access or are for a fixed term.Read More

    All businesses are exposed to risks in their day-to-day operations. Without business insurance cover to provide protection against some of these risks, businesses would find it difficult to operate efficiently and profitably.Read More

    Taxation can be very complicated and the rules, reliefs and allowances often change, so it is worth obtaining a clear grasp of how these taxes work by discussing with a professional adviser the most efficient way to arrange your finances.Read More

    Equity release has to fit with your needs, circumstances and preferences, where the benefits need to outweigh the drawbacks and be more suitable than alternative methods of raising funds.Read More

  • Testimonials
  • Enquiry Forms
    • - General Enquiry
    • - Mortgage Enquiry
    • - Investment Enquiry
    • - Protection Enquiry
    • - Pension Enquiry
  • Privacy Policy
  • Contact Us
Menu
  • Home
  • About Us
    • Our Company
    • Our Team
  • Services
    • Financial Planning
    • Mortgages
    • Protection
    • Retirement Planning
    • Savings & Investments
    • Wealth Management
    • Business Protection
    • Taxation
    • Equity Release
  • Testimonials
  • Enquiry Forms
    • General Enquiry
    • Mortgage Enquiry
    • Investment Enquiry
    • Protection Enquiry
    • Pension Enquiry
  • Privacy Policy
  • Contact Us
Related Topics
Home    Income Tax
  • Capital Gains Tax
  • Inheritance Tax
  • Introduction to Taxation

Income Tax

TAX TREATMENT VARIES ACCORDING TO INDIVIDUAL CIRCUMSTANCES AND IS SUBJECT TO CHANGE.

THE FINANCIAL CONDUCT AUTHORITY DOES NOT REGULATE ADVICE ON ESTATE PLANNING AND TAX PLANNING.

Income Tax Allowances

PLEASE NOTE: the figures shown below apply to English taxpayers. Scottish taxpayers have different rates and bands. For more details, visit https://www.gov.scot/publications/scottish-income-tax-2020-2021.

The income tax Personal Allowance for the year 2020/2021 is £12,500 (2019/2020 - £12,500). If your total income is less than this during the tax year, you have no tax to pay.

Tax rates 2020-21: Income Tax Personal Allowances

  2020 / 2021 2019 / 2020
Personal Allowance(1) £12,500 £12,500
Income limit for Personal Allowance(1) £100,000 £100,000
Income limit for married couple's allowance(2) £30,200 £29,600
Maximum amount of Married Couple's allowance for people born before 6 April 1935(3) £9,075 £8,915
Minimum amount of Married Couple's allowance for people born before 6 April 1935(4) £3,510 £3,450
Blind person's allowance £2,500 £2,450
Transferable Tax Allowance for married couples and civil partners(5) £1,250 £1,250
Dividend allowance(6) £2,000 £2,000
Personal savings allowance for basic rate taxpayers(7) £1,000 £1,000
Personal savings allowance for higher rate taxpayers(7) £500 £500

(1). This allowance is subject to the £100,000 income limit. The individual’s personal allowance is reduced where their income is above this limit. The allowance is reduced by £1 for every £2 above the limit.

(2).This age-related allowance is reduced by £1 for every £2 of income above this limit.

(3). This allowance is subject to the £30,200 income limit. The individual’s married couple’s allowance is reduced by £1 for every £2 above the limit. That reduction only applies after any reduction to their personal allowance (see note 1). The individual’s married couple’s allowance is never reduced below the minimum amount. Tax relief for the Married Couple's Allowance is given at the rate of 10%.

(4). This is also the maximum relief for maintenance payments where at least one of the parties is born before 6 April 1935.

(5). This transferable allowance is available to married couples and civil partners who are not in receipt of married couple’s allowance. A spouse or civil partner who is not liable to income tax; or not liable at the higher or additional rate, can transfer this amount of their personal allowance to their spouse or civil partner. The recipient must not be liable to income tax at the higher or additional rate. The recipient is eligible to a tax reduction of 20% of the transferred amount.

(6). Individuals will not have to pay tax on the first £2,000 of dividend income they receive.

(7). Basic rate taxpayers will not have to pay tax on the first £1,000 of savings income they receive and higher rate taxpayers will not have tax to pay on their first £500 of savings income.

Income tax bands and rates 2020-2021

  2020 / 2021 2019 / 2020
Starting rate limit for savings(8) £0 - £5,000 £0 - £5,000
Starting rate for savings income(8) 0% 0%
Basic rate band £1 - £37,500 £1 - £37,500
Basic rate 20% 20%
Higher rate band £37,501 - £150,000 £37,501 - £150,000
Higher rate 40% 40%
Additional rate band Over £150,000 Over £150,000
Additional rate 45% 45%

(8). If, after deducting your Personal Allowance from your total income liable to Income Tax, your non-savings income is above the starting rate limit then the starting rate for savings will not apply. Non-savings income includes income from employment, profits from self-employment, pensions, income from property and taxable benefits.

The rates available for dividends are the 7.5 per cent ordinary rate, the 32.5 per cent dividend upper rate and the dividend additional rate of 38.1 per cent.

The self-employed can claim business expenses against their income. So make sure you include all possible justifiable business expenses on your self-assessment form. This also applies to capital allowances for expenditure on plant and equipment, including computers and tools, for example, used for your business.

It is worth remembering you may be able to pay further contributions to your pension, which can utilise unused tax relief.

Since its introduction in 1990, Gift Aid allows taxpayers to receive tax relief on gifts made to qualifying charities.

One other point to remember is if one spouse is a tax payer and the other is not or pays tax at a lower rate it is worth considering switching certain investments to take advantage of their unused tax allowances.

For further information about the 2020 Budget changes please click here.

GENERAL ENQUIRY FORM

Marketing Information

Submit your Information

From time to time, we would like to contact you with details about our services, products, business updates and events. If you consent to us contacting you for this purpose please tick to say how you would like us to contact you:

Email
Telephone
Post
Yes please, I'd like to hear about offers and services.
No thanks, I don't want to hear about offers and services.
Please tick this box to confirm you have read and understood our privacy policy.

TAX TREATMENT VARIES ACCORDING TO INDIVIDUAL CIRCUMSTANCES AND IS SUBJECT TO CHANGE.

THE FINANCIAL CONDUCT AUTHORITY DOES NOT REGULATE ADVICE ON ESTATE PLANNING AND TAX PLANNING.

Income Tax Allowances

PLEASE NOTE: the figures shown below apply to English taxpayers. Scottish taxpayers have different rates and bands. For more details, visit https://www.gov.scot/publications/scottish-income-tax-2020-2021.

The income tax Personal Allowance for the year 2020/2021 is £12,500 (2019/2020 - £12,500). If your total income is less than this during the tax year, you have no tax to pay.

Tax rates 2020-21: Income Tax Personal Allowances

  2020 / 2021 2019 / 2020
Personal Allowance(1) £12,500 £12,500
Income limit for Personal Allowance(1) £100,000 £100,000
Income limit for married couple's allowance(2) £30,200 £29,600
Maximum amount of Married Couple's allowance for people born before 6 April 1935(3) £9,075 £8,915
Minimum amount of Married Couple's allowance for people born before 6 April 1935(4) £3,510 £3,450
Blind person's allowance £2,500 £2,450
Transferable Tax Allowance for married couples and civil partners(5) £1,250 £1,250
Dividend allowance(6) £2,000 £2,000
Personal savings allowance for basic rate taxpayers(7) £1,000 £1,000
Personal savings allowance for higher rate taxpayers(7) £500 £500

(1). This allowance is subject to the £100,000 income limit. The individual’s personal allowance is reduced where their income is above this limit. The allowance is reduced by £1 for every £2 above the limit.

(2).This age-related allowance is reduced by £1 for every £2 of income above this limit.

(3). This allowance is subject to the £30,200 income limit. The individual’s married couple’s allowance is reduced by £1 for every £2 above the limit. That reduction only applies after any reduction to their personal allowance (see note 1). The individual’s married couple’s allowance is never reduced below the minimum amount. Tax relief for the Married Couple's Allowance is given at the rate of 10%.

(4). This is also the maximum relief for maintenance payments where at least one of the parties is born before 6 April 1935.

(5). This transferable allowance is available to married couples and civil partners who are not in receipt of married couple’s allowance. A spouse or civil partner who is not liable to income tax; or not liable at the higher or additional rate, can transfer this amount of their personal allowance to their spouse or civil partner. The recipient must not be liable to income tax at the higher or additional rate. The recipient is eligible to a tax reduction of 20% of the transferred amount.

(6). Individuals will not have to pay tax on the first £2,000 of dividend income they receive.

(7). Basic rate taxpayers will not have to pay tax on the first £1,000 of savings income they receive and higher rate taxpayers will not have tax to pay on their first £500 of savings income.

Income tax bands and rates 2020-2021

  2020 / 2021 2019 / 2020
Starting rate limit for savings(8) £0 - £5,000 £0 - £5,000
Starting rate for savings income(8) 0% 0%
Basic rate band £1 - £37,500 £1 - £37,500
Basic rate 20% 20%
Higher rate band £37,501 - £150,000 £37,501 - £150,000
Higher rate 40% 40%
Additional rate band Over £150,000 Over £150,000
Additional rate 45% 45%

(8). If, after deducting your Personal Allowance from your total income liable to Income Tax, your non-savings income is above the starting rate limit then the starting rate for savings will not apply. Non-savings income includes income from employment, profits from self-employment, pensions, income from property and taxable benefits.

The rates available for dividends are the 7.5 per cent ordinary rate, the 32.5 per cent dividend upper rate and the dividend additional rate of 38.1 per cent.

The self-employed can claim business expenses against their income. So make sure you include all possible justifiable business expenses on your self-assessment form. This also applies to capital allowances for expenditure on plant and equipment, including computers and tools, for example, used for your business.

It is worth remembering you may be able to pay further contributions to your pension, which can utilise unused tax relief.

Since its introduction in 1990, Gift Aid allows taxpayers to receive tax relief on gifts made to qualifying charities.

One other point to remember is if one spouse is a tax payer and the other is not or pays tax at a lower rate it is worth considering switching certain investments to take advantage of their unused tax allowances.

For further information about the 2020 Budget changes please click here.

GENERAL ENQUIRY FORM

Marketing Information

Submit your Information

From time to time, we would like to contact you with details about our services, products, business updates and events. If you consent to us contacting you for this purpose please tick to say how you would like us to contact you:

Email
Telephone
Post
Yes please, I'd like to hear about offers and services.
No thanks, I don't want to hear about offers and services.
Please tick this box to confirm you have read and understood our privacy policy.

Read less

Mortgages

Protection

There are events we can all face...

Wealth Management

QUICK LINKS

  • Financial Planning
  • Business Insurance
  • Mortgages
  • Wealth Management
  • Taxation
  • Savings & Investments
  • Protection
  • Pensions
  • Equity Release

REQUEST A CALL BACK

NEWSLETTER

CONTACT US

Moneytree Financial Solutions Ltd
Suite 2 Sutton House
Ashville Point
Sutton Weaver
Cheshire
WA7 3FW
T: 01244 555077
Email Us

Moneytree Financial Solutions Ltd is registered in England and Wales, Company Number: 06749896. Registered Address:Suite 2a Sutton House, Ashville Point, Sutton Weaver, Cheshire, WA7 3FW.

Moneytree Financial Solutions Ltd is an appointed representative of Quilter Financial Limited which is authorised and regulated by the Financial Conduct Authority.

The guidance and/or advice contained within this website is subject to the UK regulatory regime, and is therefore targeted at consumers based in the UK.

© Copyright 2021 - Adviser Pro - All Rights Reserved

Design and Developed by Adviser Pro © 2021