at a glanceadministration of taxpersonal taxationemployment taxationbusiness taxcorporation taxcapital gains taxsavings and investmentinheritance taxcharitiestrusts

Note: It must be remembered that these proposals are subject to amendment during the passage of the Finance Bill.

PERSONAL TAXATION 2009/10 2008/09
Personal allowance    
general £6,475 £6,035
aged 65 or over in year of assessment £9,490 £9,030
aged 75 or over in year of assessment £9,640 £9,180
age allowance income limit £22,900 £21,800
minimum where income exceeds limit £6,475 £6,035
Married couple’s allowance
(10% relief)
   
either partner born before 6 April 1935 N/A £6,535
either partner aged 75 or over in year of assessment £6,965 £6,625
age allowance income limit £22,900 £21,800
minimum where income exceeds limit £2,670 £2,540
Blind person’s allowance £1,890 £1,800
Income tax rates    
Starting savings rate 10% 10%
on income up to £2,440* £2,320*
Basic rate 20% 20%
on taxable income    
up to £37,400 £34,800
Higher rate 40% 40%
on taxable income over £37,400 £34,800
Lower rate on dividend income 10% 10%
Higher rate on dividend income 32.5% 32.5%
Pension schemes allowances    
Annual allowance £245,000 £235,000
Lifetime allowance £1,750,000 £1,650,000
*Starting rate applies only to savings income. If taxable non-savings income is above this limit, the starting rate is not applicable.
 
COMPANY TAXATION FY2009 FY2008
Corporation tax rates    
All companies (except below) 28% 28%
Companies with small profits 21% 21%
— 21% rate limit £300,000 £300,000
— marginal relief limit £1,500,000 £1,500,000
— marginal relief fraction 7/400 7/400
— marginal rate 29.75% 29.75%
For certain profits from oil activities, the full rate and small profits rate are 30% and 19% respectively for both years, the marginal relief fraction is 11/400 and the marginal rate is 32.75%.
     
CAPITAL GAINS TAX 2009/10 2008/09
Rate— general 18%* 18%*
— trustees and personal representatives 18%* 18%*
General exemption limit £10,100 £9,600
*subject to available reliefs    
     
INHERITANCE TAX
Transfers after 5/4/2009
Threshold   £325,000
(previously £312,000 for transfers after 5 April 2008)
Death rate   40%
     
VAT    
Standard rate 1 Dec 2008 to 31 Dec 2009 15%
Standard rate 1 Jan 2010 to 31 Mar 2010 17.5%
Registration threshold after 30 April 2009 £68,000
(previously £67,000 after 31 March 2008)  
     
NATIONAL INSURANCE   2009/10
(2008/09 in brackets where different)
Class 1 contributions    
Not contracted out    
The employee contribution is 11% of earnings between £110 (£105) and £844 (£770) p.w. plus 1% of all earnings above £844 (£770) p.w. The employer contribution is 12.8% of all earnings in excess of the first £110 (£105) p.w.
Contracted out    
The ‘not contracted out’ rates for employees are reduced on the band of earnings from £110 (£105) p.w. to £770 p.w. by 1.6%. For employers, they are reduced on the band of earnings from £110 (£105) p.w. to £770 p.w. by 3.7% for employees in salary-related schemes or 1.4% for employees in money purchase schemes. In addition, there is an employee rebate of 1.6% and an employer rebate of 3.7% or 1.4%, as appropriate, on earnings from £95 (£90) p.w. up to £110 (£105) p.w.
 
Class 1A and 1B contributions 12.8%
   
Class 2 contributions    
Flat weekly rate £2.40 (£2.30)
Exemption limit £5,075 (£4,825)
 
Class 3 contributions    
Flat weekly rate £12.05 (£8.10)
 
Class 4 contributions    
8% on the band of profits between £5,715 (£5,435) and £43,875 (£40,040) plus 1% on all profits above £43,875 (£40,040).