Tax Rates & Thresholds 2017/18

Tax bands for Income Tax:

Basic Rate	£0 - £33,500
Higher Rate	£33,500 - £150,000
Additional Rate	Over £150,000

Personal Allowance

£11,500

Your first £11,500 of income will fall under the personal allowance and is tax free. If you have income of £45,000 then £33,500 is taxed at the basic rate and the remainder falls in the personal allowance meaning none of it falls in the higher rate.

Your personal allowance goes down by £1 for every £2 that your income is above £100,000. This means your allowance is zero if your income is £123,000 or above.

Income tax rates:

Basic Rate	20%
Higher Rate	40%
Additional Rate	45%

Dividend tax rates:

Basic Rate	7.50%
Higher Rate	32.50%
Additional Rate	38.10%

The first £5,000 dividends are taxed at 0% (dividend allowance).

Self-Employment rates:

Class of NICs

Threshold

Rate

Class 2 NICs

£6,025 profit

£2.85 / year

Class 4 NICs

£8,164 profit

9% on profits between £8,164 - £45,000

2% on profits over £45,000

National Living Wage & Minimum Wage:

25 and over	21 to 24	18 to 20	Under 18	Apprentice
£7.50	£7.05	£5.60	£4.05	£3.50

Entitlement to apprentice rate:

Aged under 19
Aged 19 or over and in first year of apprenticeship

Apprentices entitled to minimum wage:

Aged 19 or over
Have completed first year of apprenticeship

Company Taxes:

Corporation Tax Rate

19.00%

VAT Registration Threshold	£85,000
VAT Deregistration Threshold	£83,000

Flat Rate Scheme Registration Threshold

£150,000

If your income exceeds £230,000 in a year then you will need to deregister from the flat rate scheme.

Directors Loan	Liability
Not repaid within 9 months of year-end	32.50% - S455 tax
Exceeds £10,000 at any point in year	Benefit in Kind – included on your P11D

Go Back