Use these rates and thresholds when you operate your payroll or provide expenses and benefits to your employees.
Unless otherwise stated, the figures quoted apply between 6 April 2014 and 5 April 2015.
PAYE tax and Class 1 National Insurance contributions
You normally operate PAYE as part of your payroll so HM Revenue and Customs (HMRC) can collect Income Tax and National Insurance from your employees.
Your payroll software will calculate how much tax and National Insurance (NI) to deduct from your employees’ pay.
Tax thresholds, rates and codes
|PAYE tax rates, thresholds and codes||2014 to 2015|
|Employee personal allowance||£192 per week
£833 per month
£10,000 per year
|Basic tax rate||20% on annual earnings above the PAYE tax threshold and up to £31,865|
|Higher tax rate||40% on annual earnings from £31,866 to £150,000|
|Additional tax rate||45% on annual earnings above £150,000|
|Emergency tax codes||1000L W1, 1000L M1 or 1000L X|
Class 1 National Insurance thresholds
You can only make National Insurance (NI) deductions on earnings above the Lower Earnings Limit (LEL).
|Class 1 NI thresholds||2014 to 2015|
|Lower Earnings Limit (LEL)||£111 per week
£481 per month
£5,772 per year
|Primary Threshold (PT)||£153 per week
£663 per month
£7,956 per year
|Secondary Threshold (ST)||£153 per week
£663 per month
£7,956 per year
|Upper Accrual Point (UAP)||£770 per week
£3,337 per month
£40,040 per year
|Upper Earnings Limit (UEL)||£805 per week
£3,489 per month
£41,865 per year
Class 1 National Insurance rates
Employee (primary) contribution rates
Deduct primary contributions (employee’s National Insurance) from your employees’ pay through PAYE.
|NI category letter||Earnings at or above LEL up to and including PT||Earnings above the PT up to and including UAP||Earnings above UAP up to and including UEL||Balance of earnings above UEL|
Employer (secondary) contribution rates
You pay secondary contributions (employer’s National Insurance) to HMRC as part of your PAYE bill.
|NI category letter||Earnings at or above LEL up to and including ST||Earnings above ST up to and including UAP||Earnings above UAP up to and above UEL|
Class 1A National Insurance: expenses and benefits
|NI class||2014 to 2015 rate|
Class 1B National Insurance: PAYE Settlement Agreements (PSAs)
You pay Class 1B National Insurance if you have a PSA. This allows you to make one annual payment to cover all the tax and National Insurance due on small or irregular taxable expenses or benefits for your employees.
|NI class||2014 to 2015 rate|
National Minimum Wage
The National Minimum Wage is the minimum pay per hour almost all workers are entitled to by law. Use the National Minimum Wage calculator to check if you’re paying a worker the National Minimum Wage or if you owe them payments from past years.
The rates below apply from 1 October 2014 and are likely to change again on 1 October 2015.
|Category of worker||Hourly rate|
|Aged 21 and above||£6.50|
|Aged 18 to 20 inclusive||£5.13|
|Aged under 18 (but above compulsory school leaving age)||£3.79|
|Apprentices aged under 19||£2.73|
|Apprentices aged 19 and over, but in the first year of their apprenticeship||£2.73|
Statutory maternity, paternity and adoption pay
Use the maternity and paternity calculator for employers to calculate your employee’s SMP, paternity or adoption pay, their qualifying week, average weekly earnings and leave period.
|Type of payment or recovery||2014 to 2015 rate|
|Statutory maternity pay (SMP) - weekly rate for first six weeks||90% of the employee’s average weekly earnings|
|SMP - weekly rate for remaining weeks||£138.18 or 90% of the employee’s average weekly earnings, whichever is lower|
|Ordinary statutory paternity pay (OSPP) and Additional Statutory Paternity Pay (ASPP) - weekly rate||£138.18 or 90% of the employee’s average weekly earnings, whichever is lower|
|Statutory adoption pay (SAP) - weekly rate||£138.18 or 90% of the employee’s average weekly earnings, whichever is lower|
|SMP/OSPP/ASPP/SAP - proportion of your payments you can recover from HMRC||92% if your total Class 1 NI (both employee and employer contributions) is above £45,000 for the previous tax year
103% if your total Class 1 NI for the previous tax year is £45,000 or lower
Statutory Sick Pay (SSP)
The same weekly SSP rate applies to all employees. However, the amount you must actually pay an employee for each day they’re off work due to illness (the daily rate) depends on the number of ‘qualifying days’ (QDs) they work each week.
Use the SSP calculator to work out your employee’s sick pay, or use the rates below.
|Unrounded daily rates||Number of QDs in week||1 day to pay||2 days to pay||3 days to pay||4 days to pay||5 days to pay||6 days to pay||7 days to pay|
Student loan recovery
If your employees’ earnings are above the earnings threshold, record their student loan deductions in your payroll software. It will automatically calculate and deduct repayments from their pay.
|Rate or threshold||2014 to 2015 rate|
|Employee earnings threshold||£16,910 per year
£1,409.16 per month
£325.19 per week
|Student loan deductions||9%|
Company cars: Advisory Fuel Rates (AFRs)
Use AFRs to work out mileage costs if you provide company cars to your employees.
The rates below apply from 1 December 2014.
|1400cc or smaller||13p||9p|
|1401cc to 2000cc||16p||11p|
|Bigger than 2000cc||23p||16p|
|1600cc or smaller||11p|
|1601cc to 2000cc||13p|
|Bigger than 2000cc||16p|
Employee vehicles: Mileage Allowance Payments (MAPs)
MAPs are what you pay your employees for using their own vehicle for business journeys.
You can pay your employees an ‘approved amount’ of MAPs each year without having to report them to HMRC. To work out the ‘approved amount’, multiply your employee’s business travel miles for the year by the rate per mile for their vehicle.
Find out more about reporting and paying MAPs.
|Type of vehicle||Rate per business mile 2014 to 2015|
|Car||For tax purposes: 45p for the first 10,000 business miles in a tax year, then 25p for each subsequent mile
For NI purposes: 45p for all business miles
|Motorcycle||24p for both tax and NI purposes and for all business miles|
|Cycle||20p for both tax and NI purposes and for all business miles|