Tax Information

INCOME TAX RATES

INCOME TAX RELIEFS

2007/08

2007/08

Rate  %

Personal Allowance

£

0-2,230

10

Under 65

5,225

2,231-34,600

22*

65-74✦

7,550

Over 34,601

40**

75 and over✦

7,690

*   Except dividends (10%) and savings income (20%)

** Except dividends (32.5%). Other income taxed first, then savings income and finally dividends.

✦Reduce age allowance by £1 for every £2 of excess income over £20,900.

In addition, a married couple’s allowance may be available to those born before 6.4.35 

NATIONAL INSURANCE

Class 1 (employed) (Contracted in)

Weekly Earnings

2007/08 Rates

Employer

Employee

Up to £100.01

Nil*

Nil*

£100.01-£670

12.8%**

11%**

Over £670

12.8%**

£62.69 +1%✦

*   Entitlement to contribution-based benefits retained for earnings between £87 and £100.01 per week.

**  On earnings above £100.01

✦ On earnings above £670

Class 1A (employers)

Class 1B (employers) 

Class 2 (self-emp.)

Class 3 (voluntary)

Class 4 (self-emp.)

12.8% on employee taxable benefits

12.8% on PAYE Settlement Agreements.

Flat rate per week £2.20. Small earnings exception p.a. £4,635

Flat rate per week £7.80

8% on profits between £5,225 and £34,840 plus 1% on profits over £34,840.

PENSION PREMIUMS

Maximum contributions: higher of £3,600 (gross) and percentage (between 17.5% and 40% depending on age) of net relevant earnings.

CAR AND FUEL BENEFITS

Company Cars – 2007/08

Notes:
1. the list price includes accessories and is subject to an upper limit of £80,000

2. List price is reduced for capital contributions made by the employee up to £5,000

3. Payments made by employees may reduce the benefits

4. For cars registered before 1.1.98 charge is based on engine size.

% of car’s list price taxed

C0₂ emissions in grams per km

15%

Up to 140

Additional 1%

For every additional 5

Up to 35% (max)

240 and above

n  For diesel cars add 3% supplement, but maximum still 35%. Until 5.04.06 supplement waived for Euro IV diesels

n  If the C0₂  figure doesn’t end in a 5 or 0 round down to the nearest 5 or 0.

n  Discounts apply to certain (‘greener’) cars.

Van Benefit 2007/08

Notes:

1. The charge only applies if there is unrestricted private use of the van

Van Rate    £3000*

Fuel Rate  £500*

*per vehicle

Car fuel scale charge – 2007/08

£14,400 x ‘appropriate percentage’*

*percentage used to calculate the taxable benefit of the car for which the fuel is provided. The charge is proportionately reduced if provision of private fuel ceases part way through the year.

MILEAGE ALLOWANCE PAYMENTS 2007/08

Cars and Vans

Up to 10,000 miles

Over 10,000 miles

Bicycles

Motorcycles

Rate per mile

40p

25p

20p

24p

VALUE ADDED TAX

Standard Rate

Lower Rate

Annual Registration Limit – from 1 April 2007

17.5%

5%

£64,000

CORPORATION TAX

Year to 31.03.08

Rate %

Profits Band £

Small companies rate

20 

up to 300,000

Marginal (small companies) rate

32.50

300,001-1,500,000

Full Rate

30

Over 1,500,000

CAPITAL GAINS TAX

2007/08

Individuals

Exemption

Balance of gains (reduced by taper relief) charged as top slice of income (at savings rates – i.e. 10%, 20% or 40%)

£9,200

Trusts

Exemption

Balance of gains (reduced by taper relief)

£4,600

40%

INHERITANCE TAX

Chargeable Transfers

Death Rate %

Lifetime Rate %

2007/08

Nil

40

Nil

20

0-£300,000

Over £300,000

Reliefs

Annual exemption

Small Gifts

£3,000

£250

The tax information provided above is based on the 2007 Budget and other earlier announcements and may be subject to amendment by the Finance Act. We are not held responsible for use of any information on our site.