Tax and National Insurance contribution rates

Updated on 21 April 2022

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Illustration of a tax calculator and paperwork

Income tax allowance

Allowances £

2020/21

2021/22

2022/23

Personal Allowances*

 

 

 

individuals

12,500

12,570

12,570

Transferable tax allowance:

 

 

 

for married couples and civil partners

1,250

1,260

1,260

Married couple's allowance:

 

 

 

for those born before 6 April 1935, maximum amount

9,075

9,125

9,415

for those born before 6 April 1935, minimum amount

3,510

3,530

3,640

Blind person's allowance

2,500

2,520

2,600

Income limit for personal allowance

100,000

100,000

100,000

Income limit for married couple’s allowance**

30,200

30,400

31,400

Dividend Allowance***

2,000

2,000

2,000

Personal Savings Allowance****

 

 

 

Basic Rate Taxpayers

1,000

1,000

1,000

Higher Rate Taxpayers

500

500

500


* Before 2016/17 an individual’s personal allowance depended on their date of birth and their income in the tax year. From 2016/17 onwards, all individuals are entitled to the same personal allowance, regardless of their date of birth; this is subject to the income limit of £100,000.

** The married couple’s allowance is reduced, where the taxpayer’s income in the tax year is above the income limit, by £1 for every £2 above the limit until the level of the minimum married couple’s allowance is reached.

*** From 2016/17, any individual who receives dividend income is entitled to a Dividend Allowance. This is a nil rate band of tax, which means an individual pays no income tax on their dividend income up to the amount of the allowance. It does not reduce the amount of taxable income.

**** From 2016/17, basic rate and higher rate taxpayers (but not additional rate taxpayers) who receive savings income are entitled to a Personal Savings Allowance. This is a nil rate band of tax, which means that basic rate and higher rate taxpayers pay no income tax on £1,000 or £500 of savings income respectively. The Personal Savings Allowance does not reduce the amount of taxable income.

Income tax: taxable bands

N.B. Income is charged to tax according to the rates and bands in the table(s) below after deducting any allowances (such as the personal allowance and blind person’s allowance) to which the person is entitled. * **

UK income tax

2020/21

Band

2021/22

Band

2022/23

Band

Starting rate for savings
0%

Up to £5,000

Starting rate for savings
0%

Up to £5,000

Starting rate for savings
0%

Up to £5,000

Basic rate
20%

Up to £37,500

Basic rate
20%

Up to £37,700

Basic rate
20%

Up to £37,700

Higher rate
40%

£37,501 to £150,000

Higher rate
40%

£37,701 to £150,000

Higher rate
40%

£37,701 to £150,000

Additional rate
45%

Over £150,000

Additional rate
45%

Over £150,000

Additional rate
45%

Over £150,000


* From April 2016, if you live in Scotland and are a Scottish taxpayer, Scottish rates and bands apply to your non-savings, non-dividend income. See our pages on Scottish income tax for more information.

Scottish income tax

2020/21

Band

2021/22

Band

2022/23

Band

Starter rate 19%

Up to £2,085

Starter rate 19%

Up to £2,097

Starter rate 19%

Up to £2,162

Basic rate
20%

£2,086 to £12,658

Basic rate 20%

£2,098 to £12,726

Basic rate 20%

£2,163 to £13,118

Intermediate rate 21%

£12,659 to £30,930

Intermediate rate 21%

£12,727 to £31,092

Intermediate rate 21%

£13,119 to £31,092

Higher rate 41%

£30,931 to £150,000

Higher rate 41%

£31,093 to £150,000

Higher rate 41%

£31,093 to £150,000

Top rate 46%

Over £150,000

Top rate 46%

Over £150,000

Top rate 46%

Over £150,000


** From April 2019, if you live in Wales and are a Welsh taxpayer, Welsh rates and bands apply to your non-savings, non-dividend income. See our pages on Welsh income tax for more information.

Welsh income tax

2020/21

Band

2021/22

Band

2022/23

Band

Basic rate 20%

Up to £37,500

Basic rate 20%

Up to £37,700

Basic rate 20%

Up to £37,700

Higher rate 40%

£37,501 to £150,000

Higher rate 40%

£37,701 to £150,000

Higher rate 40%

£37,701 to £150,000

Additional rate 45%

Over £150,000

Additional rate 45%

Over £150,000

Additional rate 45%

Over £150,000


Dividends

NB * **

2020/21

Tax rate

2021/22

Tax rate

2022/23

Tax rate

Up to £37,500

7.5%

Up to £37,700

7.5%

Up to £37,700

8.75%

£37,501 - £150,000

32.5%

£37,701 - £150,000

32.5%

£37,701 - £150,000

33.75%

Over £150,000

38.1%

Over £150,000

38.1%

Over £150,000

39.35%


* From April 2016 the dividend tax credit (10%) was abolished and replaced with a tax-free Dividend Allowance. In addition, the dividend tax rates changed.

** In 2022/23 the dividend rates increased to 8.75%, 33.75% and 39.35% to include 1.25% for the health and social care levy.

National Insurance contributions (NIC)

Class 1 primary NIC (employee – EE) * **

£ per week (unless stated)

2020/21

2021/22

2022/23

Lower earnings limit

120

120

123

Primary threshold

183

184

190 (6 April – 5 July)

242 (6 July – 5 April)

Upper accrual point

n/a

n/a

n/a

Upper earnings limit

962

967

967

EE primary Class 1 rate between primary threshold and upper earnings limit

12%

12%

13.25%

EE primary Class 1 rate above upper earnings limit

2%

2%

3.25%

EE contracted-out rebate – salary

n/a

n/a

n/a

Married women's reduced rate between primary threshold and upper earnings limit

5.85%

5.85%

7.1%

Married women's rate above upper earnings limit

2%

2%

3.25%


* For 2022/23 the Class 1 primary NIC rates include an extra 1.25% for the health and social care levy. The rates should fall again from 6 April 2023, when the separate health and social care levy commences.

** During 2022/23 the earnings level at which you start to pay National Insurance contributions is increasing. For employees, the increase takes effect on 6 July 2022.

Class 1 secondary NIC (employers – ER) *

£ per week (unless stated)

2020/21

2021/22

2022/23

Secondary threshold

169

170

175

ER secondary Class 1 rate above secondary threshold

13.8%

13.8%

15.05%

ER contracted-out rebate – salary related schemes

n/a

n/a

n/a


* For 2022/23 the Class 1 secondary NIC rate includes an extra 1.25% for the health and social care levy. The rate should fall again from 6 April 2023, when the separate health and social care levy commences.

Class 2 NIC (self-employed) *

£ per week (unless stated)

2020/21

2021/22

2022/23

Class 2 rate

3.05

3.05

3.15

Class 2 small earnings exception/small profits (per year)

6,475

6,515

6,725

Class 2 lower profits limit

9,500

9,568

 

11,908

 

Special Class 2 rate for share fishermen

3.70

3.70

3.80

Special Class 2 rate for volunteer development workers

6.00

6.00

6.15


* For years up to and including 2021/22, you pay Class 2 NIC if your profits are more than the small profits threshold. For 2022/23, you only pay Class 2 NIC if your profits are more than the lower profits limit. If you have profits between the small profits threshold and the lower profits limit, you will not have to pay Class 2 NIC, but you will be treated as though you have paid it, for the purpose of entitlement to contributory benefits.

Class 3 NIC (voluntary)

£ per week

2020/21

2021/22

2022/23

Class 3 rate

15.30

15.40

15.85


Class 4 NIC (self-employed) *

£ per year

2020/21

2021/22

2022/23

Class 4 lower profits limit

9,500

9,568

11,908

Class 4 upper profits limit

50,000

50,270

50,270

Class 4 rate between lower profits limit and upper profits limit

9%

9%

10.25%

Class 4 rate above upper profits limit

2%

2%

3.25%


* For 2022/23 the Class 4 NIC rates include an extra 1.25% for the health and social care levy. The rates should fall again from 6 April 2023, when the separate health and social care levy commences.

Capital gains tax

 

2020/21

2021/22

2022/23

Standard rate*

10% / 18%

10% / 18%

10% / 18%

Rate for higher and additional taxpayers

20% / 28%

20% / 28%

20% / 28%

Annual exemption

£12,300

£12,300

£12,300

Business Asset Disposal Relief rate

10%

10%

10%

Business Asset Disposal Relief lifetime limit

£10m

£1m

£1m


* CGT rates of 10% and 20% introduced in Finance Bill 2016 for disposals on or after 6 April 2016 do not apply to transactions involving residential property or carried interest. CGT rates for these transactions remain at 18% and 28%.

Inheritance tax

Chargeable lifetime transfers (after exemptions)

2020/21

2021/22

2022/23

Nil rate band – 0%

Up to £325,000

Up to £325,000

Up to £325,000

20%

Over £325,000

Over £325,000

Over £325,000

On death (net estate)

 

 

 

Nil band rate – 0%

Up to £325,000

Up to £325,000

Up to £325,000

Residence nil rate band* – 0%

Up to £175,000

Up to £175,000

Up to £175,000

40% **

Over £325,000 or £500,000 (325,000 + 175,000)

Over £325,000 or £500,000 (325,000 + 175,000)

Over £325,000 or £500,000 (325,000 + 175,000)


* From April 2017, there is a residence nil rate band. This will be available on the death of an individual, if they pass on a property, which has been their residence at some point, to a direct descendant.
** There is a reduced rate of 36% for estates that leave 10% or more to charity.

Other rates

You can view income tax rates and allowances for prior years on GOV.UK

Rates and thresholds for employers: 2022 to 2023

These are the rates and thresholds that employers use when they operate your payroll. They include statutory sick pay and parental pay rates as well as student loan and minimum wage rates.

For other rates and allowances, including in respect of child benefit and tax credits, see Rates and allowances: HM Revenue and Customs (this collection brings together the main rates of tax and duty, interest rates, exchange rates and allowances published by HMRC).

For a list of pension and benefit rates, see GOV.UK..

The auto-enrolment thresholds in 2022/23 can be found on GOV.UK.

Tax guides

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