Tax and tax credit rates and thresholds for 2017-18
Published 23 November 2016
1. Personal tax and benefits
1.1 Income tax bands of taxable income (£ per year)
Tax year 2016-17 | Tax year 2017-18 | |
---|---|---|
Basic rate | £0-32,000 | £0-33,500 |
Higher rate | £32,001-150,000 | £33,500-150,000 |
Additional rate | Over £150,000 | Over £150,000 |
1.2 Income tax rates - 2016-17
Tax year 2016-17 | |
---|---|
Main rates [footnote 1] | |
Basic rate | 20% |
Higher rate | 40% |
Additional rate | 45% |
Dividend rates [footnote 2] | |
Dividend ordinary rate - for dividends otherwise taxable at the basic rate | 7.5% |
Dividend upper rate - for dividends otherwise taxable at the higher rate | 32.5% |
Dividend additional rate - for dividends otherwise taxable at the additional rate | 38.1% |
1.3 Income tax rates - 2017-18
Main rates [footnote 3] | |
Basic rate | 20% |
Higher rate | 40% |
Additional rate | 45% |
Savings rates [footnote 4] | |
Starting rate for savings | 0% |
Savings basic rate | 20% |
Savings higher rate | 40% |
Savings additional rate | 45% |
Dividend rates [footnote 5] | |
Dividend ordinary rate - for dividends otherwise taxable at the basic rate | 7.5% |
Dividend upper rate - for dividends otherwise taxable at the higher rate | 32.5% |
Dividend additional rate - for dividends otherwise taxable at the additional rate | 38.1% |
Default rates [footnote 6] | |
Default basic rate | 20% |
Default higher rate | 40% |
Default additional rate | 45% |
1.4 Starting rates for savings income
Tax year 2016-17 | Tax year 2017-18 | |
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Starting rate for savings | 0% | 0% |
Starting rate limit for savings | £5,000 | £5,000 |
1.5 Special rates for trustees’ income
Tax year 2016-17 | Tax year 2017-18 | |
Standard rate on first £1,000 of income which would otherwise be taxable at the special rates for trustees | Up to 20%, depends on the type of income | Up to 20%, depends on the type of income |
Trust rate | 45% | 45% |
Dividend trust rate | 38.1% | 38.1% |
1.6 Income tax allowances
Tax year 2016-17 | Tax year 2017-18 | |
Personal allowance | ||
Personal allowance [footnote 7] | £11,000 | £11,500 |
Income limit for personal allowance | £100,000 | £100,000 |
Income limit for Married couple’s allowance [footnote 8] | £27,700 | £28,000 |
Marriage allowance | ||
Marriage allowance [footnote 9] | £1,100 | £1,150 |
Married couple’s allowance for those born before 6 April 1935 | ||
Maximum amount of married couple’s allowance [footnote 10] | £8,355 | £8,445 |
Minimum amount of married couple’s allowance [footnote 10] | £3,220 | £3,260 |
Blind person’s allowance | ||
Blind person’s allowance | £2,290 | £2,320 |
Dividend allowance | ||
Dividend allowance [footnote 11] | £5,000 | £5,000 |
Personal savings allowance | ||
Personal savings allowance for basic rate taxpayers [footnote 12] | £1,000 | £1,000 |
Personal savings allowance for higher rate taxpayers [footnote 12] | £500 | £500 |
2. National Insurance Contributions (NIC)
2.1 Class 1 NICs: Employee and employer rates and thresholds (£ per week)
Tax year 2016-17 | Tax year 2017-18 | |
Weekly Lower Earnings Limit (LEL) [footnote 13] | 112 | 113 |
Weekly Primary Threshold (PT) [footnote 13] | 155 | 157 |
Weekly Secondary Threshold (ST) [footnote 14] | 156 | 157 |
Upper Earnings Limit (UEL) [footnote 15] | 827 | 866 |
Upper Secondary Threshold for under 21s [footnote 15] | 827 | 866 |
Apprentice Upper Secondary Threshold (AUST) for under 25s [footnote 15] | 827 | 866 |
Employment Allowance (per employer) | 3,000 per year | 3,000 per year |
Employee’s (primary) Class 1 contribution rates | Tax year 2016-17 | Tax year 2017-18 |
Earnings band [footnote 16] | NIC rate (per cent) | NIC rate (per cent) |
Below LEL | 0 | 0 |
LEL - PT [footnote 17] | 0 | 0 |
PT- UEL | 12 | 12 |
Above UEL | 2 | 2 |
Married woman’s reduced rate for (primary) Class 1 contribution rates | Tax year 2016-17 | Tax year 2017-18 |
Weekly earnings from between the PT and UEL | 5.85 | 5.85 |
Weekly earnings from above UEL | 2 | 2 |
Employer’s (secondary) Class 1 contribution rates | Tax year 2016-17 | Tax year 2017-18 |
Earnings band [footnote 18] | ||
Below ST | 0 | 0 |
Above ST | 13.8 | 13.8 |
Employer’s (secondary) Class 1 contribution rates for employees under 21 | Tax year 2016-17 | Tax year 2017-18 |
Earnings band [footnote 19] | ||
Below UST | 0 | 0 |
Above UST | 13.8 | 13.8 |
Employer’s (secondary) Class 1 contribution rates for Apprentices under 25 | Tax year 2016-17 | Tax year 2017-18 |
Earnings band [footnote 20] | ||
Below AUST | 0 | 0 |
Above AUST | 13.8 | 13.8 |
2.2 Class 2 NICs: Self-employed rates and thresholds (£ per week)
Tax year 2016-17 | Tax year 2017-18 | |
Small Profits Threshold (SPT) [footnote 13] | 5,965 per year | 6,025 per year |
Class 2 contribution rates [footnote 13] | Tax year 2016-17 | Tax year 2017-18 |
Annual Profits (£ a year) [footnote 21] | £ per week | £ per week |
Below SPT | 0 | 0 |
Above SPT [footnote 22] | 2.80 | 2.85 |
Special Class 2 rate for share fishermen | 3.45 | 3.50 |
Special Class 2 rate for volunteer development workers | 5.60 | 5.65 |
2.3 Class 3 NICs: Other rates and thresholds (£ per week)
Tax year 2016-17 | Tax year 2017-18 | |
Voluntary contributions [footnote 13] [footnote 23] | 14.10 | 14.25 |
2.4 Class 4 NICs: Self-employed rates and thresholds (£ per year)
Tax year 2016-17 | Tax year 2017-18 | |
Lower Profits Limit (LPL) [footnote 13] | 8,060 | 8,164 |
Upper Profits Limit (UPL) [footnote 15] | 43,000 | 45,000 |
Class 4 contribution rates | Tax year 2016-17 | Tax year 2017-18 |
Annual profits band [footnote 24] | NIC rate (per cent) | NIC rate (per cent) |
Below LPL | 0 | 0 |
LPL to UPL | 9 | 9 |
Above UPL | 2 | 2 |
3. Working and Child tax credits, child benefit and guardians allowance
3.1 Working and child tax credits
£ per year (unless stated) | Tax year 2016-17 | Tax year 2017-18 |
Working tax credit | ||
Basic element | £1,960 | £1,960 |
Couple and lone parent element | £2,010 | £2,010 |
30 hour element | £810 | £810 |
Disabled worker element | £2,970 | £3,000 |
Severe disability element | £1,275 | £1,290 |
Childcare element of the working tax credit | ||
Maximum eligible cost for one child | £175 per week | £175 per week |
Maximum eligible cost for two or more children | £300 per week | £300 per week |
Percentage of eligible costs covered | 70% | 70% |
Child tax credit | ||
Family element | £545 | £545 |
Child element | £2,780 | £2,780 |
Disabled child element | £3,140 | £3,175 |
Severely disabled child element | £1,275 | £1,290 |
Income thresholds and withdrawal rates | ||
Income threshold | £6,420 | £6,420 |
Withdrawal rate (per cent) | 41% | 41% |
First threshold for those entitled to child tax credit only | £16,105 | £16,105 |
Income rise disregard | £2,500 | £2,500 |
Income fall disregard | £2,500 | £2,500 |
3.2 Child benefit (£ per week)
Tax year 2016-17 | Tax year 2017-18 | |
Eldest/only child | £20.70 | £20.70 |
Other children | £13.70 | £13.70 |
Guardians allowance (£ per week) | ||
Guardians allowance | £16.55 | £16.70 |
4. Tax free savings accounts
Tax year 2016-17 | Tax year 2017-18 | |
Individual Savings Account (ISA) subscription limit | £15,240 | £20,000 |
Junior ISA subscription limit | £4,080 | £4,128 |
Child Trust Fund (CTF) subscription limit | £4,080 | £4,128 |
5. Fuel benefit and van benefit charge
Tax year 2016-17 | Tax year 2017-18 | |
Car fuel benefit charge multiplier | £22,200 | £22,600 |
Van fuel benefit charge | £598 | £610 |
Van benefit charge | £3,170 | £3,230 |
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Apply to non-dividend income, including income from savings, employment, property or pensions. From 2017-18, the main rates will be separated into the main rates, the savings rates and the default rates ↩
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Apply to dividend income received above the £5,000 tax-free Dividend Allowance, introduced in April 2016 to replace the Dividend Tax Credit ↩
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Apply to non-savings, non-dividend income, including income from employment, property or pensions not subject to the Scottish Rate of income tax ↩
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Apply to savings income ↩
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Apply to dividend income received above the £5,000 tax-free Dividend Allowance, introduced in April 2016 to replace the previous Dividend Tax Credit ↩
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Apply to non-savings and non-dividend income of any taxpayer that is not subject to either the Main rates or the Scottish Rates of income tax ↩
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The Personal Allowance reduces where the income is above £100,000 – by £1 for every £2 of income above the £100,000 limit. This reduction applies irrespective of date of birth ↩
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This age-related allowance is reduced by £1 for every £2 of income over this limit ↩
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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 rates, can transfer this amount of their unused personal allowance to their spouse or civil partner. The recipient must not be liable to income tax at the higher or additional rates ↩
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From April 2016, the new Dividend Allowance means that individuals will not have to pay tax on the first £5,000 of dividend income they receive ↩
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From April 2016, the new Personal Savings Allowance means that 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. ↩ ↩2
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Autumn Statement 2016 announced that the Secondary Threshold would be aligned with the Primary Threshold. From April 2018 onwards, it will be uprated in line with CPI ↩
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These thresholds are uprated in line with the Higher Rate Threshold to maintain alignment between the Upper Earnings Limit and Higher Rate Threshold ↩ ↩2 ↩3 ↩4
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The limits are defined as LEL - Lower Earnings Limit; PT - Primary Threshold; and UEL - Upper Earnings Limit ↩
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No National Insurance contributions (NICs) are actually payable but a notional Class 1 NIC is deemed to have been paid in respect of earnings between the LEL and PT to protect contributory benefit entitlement. ↩
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The limit is defined as ST – Secondary Threshold ↩
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The limit is defined as UST – Upper Secondary Threshold ↩
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The limit is defined as AUST – Apprentice Upper Secondary Threshold ↩
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The Limit is defined as SPT – Small Profits Threshold ↩
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Class 2 NICs are liable to be paid by all self-employed persons with profits above the Small Profits Threshold (SPT). The self-employed may choose to pay Class 2 if their profits are below the SPT ↩
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Class 3 NICs can be paid by contributors to make the year a qualifying year for the basic State Pension (new State Pension from 6 April 2016) and Bereavement Benefit purposes ↩
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These limits are defined as LPL – Lower Profits Limit; and UPL – Upper Profits Limit ↩