Income tax and personal savings

The Chancellor announced the following income tax rates and allowances.

Income tax rates and bands

2021/22 2020/21
Band £ Rate % Band £ Rate %
0 - 37,700 20 0 - 37,500 20
37,701 - 150,000 40 37,501 - 150,000 40
Over 150,000 45 Over 150,000 45

Income tax rates in Scotland and Wales on income other than savings and dividend income have been devolved.

Savings income

Savings Allowance 2021/22 2020/21
Basic rate £1,000 £1,000
Higher rate £500 £500

A starting rate for savings band of £5,000 at 0% may be available unless taxable non-savings income exceeds the starting rate band.

Dividend income

Allowance/Rate 2021/22 2020/21
Dividend allowance £2,000 £2,000
Dividend ordinary rate 7.5% 7.5%
Dividend upper rate 32.5% 32.5%
Dividend additional rate 38.1% 38.1%

Personal allowances

  2021/22 2020/21
Personal allowance £12,570 £12,500
Personal allowance income limit £100,000 £100,000
Marriage allowance
Transferable between certain spouses where neither pay tax above the basic rate
£1,260 £1,250
Married couple's allowance (MCA) (relief given at 10%)
Either partner born before 6 April 1935
£9,125 £9,075
- minimum amount £3,530 £3,510
- income limit £30,400 £30,200
Blind person's allowance £2,520 £2,500

Scottish income tax rates and bands

Savings and dividend income are taxed using UK rates and bands.

2021/22 2020/21
Band £ Rate % Band £ Rate %
0 - 2,097 19 0 - 2,085 19
2,098 - 12,726 20 2,086 - 12,658 20
12,727 - 31,092 21 12,659 - 30,930 21
31,093 - 150,000 41 30,931 - 150,000 41
Over 150,000 46 Over 150,000 46

Welsh income tax rates

Although income tax for Wales has been devolved, Welsh resident taxpayers continue to pay the same overall rates as taxpayers in England and Northern Ireland.

Copyright

© 2024 Michael Letch & Partners LLP. All rights reserved.

We use cookies on this website, you can find more information about cookies here.
Contact Us

Please call:
01277 655 626

Quick links

Home | Contact us | Site map | Accessibility | Disclaimer | Privacy | Help |

Address
Michael Letch & Partners LLP, 146 High Street, Billericay, Essex CM12 9DF

Michael Letch & Partners LLP is a limited liability partnership registered in England and Wales with registration number OC328815.

Michael Letch & Partners LLP is regulated by the Association of Chartered Certified Accountants in the United Kingdom.

Michael Letch & Partners LLP is also regulated by the Financial Conduct Authority to carry out specific activities and investment advice (registration number 112064).

The term ‘Partner’ is used to refer to a member of Michael Letch & Partners LLP. A list of members is open to inspection at our registered office at 146 High Street, Billericay, Essex, CM12 9DF.

Michael Letch & Partners LLP is registered to carry out audits in the UK by the Association of Chartered Certified Accountants.