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From 6 January 2024, the main rate of class 1 National Insurance contributions (NIC) deducted from employees’ wages is reduced from 12% to 10%. From 6 April 2024, the main rate of self-employed class 4 NIC will reduce from 9% to 8% and class 2 NIC will no longer be due. Those with profits below £6,725 a year can continue to pay class 2 NIC to keep their entitlement to certain state benefits. Our guidance will be updated in full in spring 2024.

Updated on 6 April 2023

Tax and NIC rates and bands

We set out the rates, bands, thresholds and allowances for different taxes and National Insurance contributions.

Content on this page:

Income tax

Allowances

Allowances

2021/22

2022/23

2023/24

Personal allowance

£

£

£

individuals

12,570

12,570

12,570

Transferable tax allowance

 

 

 

for married couples and civil partners

1,260

1,260

1,260

Married couple's allowance

 

 

 

for those born before 6 April 1935, maximum amount

9,125

9,415

10,375

for those born before 6 April 1935, minimum amount

3,530

3,640

4,010

Blind person's allowance

2,520

2,600

2,870

Income limit for personal allowance

100,000

100,000

100,000

Income limit for married couple’s allowance1

30,400

31,400

34,600

Dividend allowance2

2,000

2,000

1,000

Personal savings allowance3

 

 

 

Basic rate taxpayers

1,000

1,000

1,000

Higher rate taxpayers

500

500

500

1 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.

2 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.

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.

Taxable rates and bands

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.

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.

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.

Below we set out the UK income tax rates first, then Scottish and Welsh rates in separate tables.

UK income tax

2021/22

2022/23

2023/24

Rate Band Rate Band Rate 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 £37,700 Basic rate 20% Up to £37,700 Basic rate 20% Up to £37,700
Higher rate 40% £37,701 to £150,000 Higher rate 40% £37,701 to £150,000 Higher rate 40% £37,701 to £125,140
Additional rate 45% Over £150,000 Additional rate 45% Over £150,000 Additional rate 45% Over £125,140

Scottish income tax

2021/22

2022/23

2023/24

Rate Band Rate Band Rate Band
Starter rate 19% Up to £2,097 Starter rate 19% Up to £2,162 Starter rate 19% Up to £2,162
Basic rate 20% £2,098 to £12,726 Basic rate 20% £2,163 to £13,118 Basic rate 20% £2,163 to £13,118
Intermediate rate 21% £12,727 to £31,092 Intermediate rate 21% £13,119 to £31,092 Intermediate rate 21% £13,119 to £31,092
Higher rate 41% £31,093 to £150,000 Higher rate 41% £31,093 to £150,000 Higher rate 42% £31,093 to £125,140
Top rate 46% Over £150,000 Top rate 46% Over £150,000 Top rate 47% Over £125,140


Welsh income tax

2021/22

2022/23

2023/24

Rate Band Rate Band Rate Band
Basic rate 20% Up to £37,700 Basic rate 20% Up to £37,700 Basic rate 20% Up to £37,700
Higher rate 40% £37,701 to £150,000 Higher rate 40% £37,701 to £150,000 Higher rate 40% £37,701 to £125,140
Additional rate 45% Over £150,000 Additional rate 45% Over £150,000 Additional rate 45% Over £125,140

Dividends

2021/22

2022/23

2023/24

Rate Band Rate Band Rate Band
7.5%

Up to £37,700

8.75%

Up to £37,700

8.75%

Up to £37,700

32.5%

£37,701 to £150,000

33.75%

£37,701 to £150,000

33.75%

£37,701 to £125,140

38.1%

Over £150,000

39.35%

Over £150,000

39.35%

Over £125,140

In 2022/23, the dividend rates increased to 8.75%, 33.75% and 39.35% to mirror the 1.25% health and social care levy on earned income. The health and social care levy no longer exists, but the dividend rates remain at their higher levels.

See also Tax on dividends.

National Insurance contributions (NIC)

Class 1 primary NIC (employee)

Thresholds

 

2021/22

2022/23

2023/24

 

£ per week

£ per week

£ per week

Lower earnings limit

120

123

123

Primary threshold

184

190 (6 April – 5 July)

242 (6 July – 5 April)

242

Upper earnings limit

967

967

967

Rates

 

2021/22

2022/23

2023/24

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

12%

13.25% (6 April – 5 November)

12% (6 November – 5 April)

12%

Employee primary Class 1 rate above upper earnings limit

2%

3.25% (6 April – 5 November)

2% (6 November – 5 April)

2%

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

5.85%

7.1% (6 April – November)

5.85% (6 November - 5 April)

5.85%

Married women's rate above upper earnings limit

2%

3.25% (6 April – 5 November)

2% (6 November – 5 April)

2%

For 2022/23, from 6 April 2022 until 5 November 2022, the Class 1 primary rates included an extra 1.25% prior to the planned introduction of the health and social care levy. However, the health and social care levy was abolished and never took effect.

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

See NIC for employees.

Class 1 secondary NIC (employers)

Thresholds

 

2021/22

2022/23

2023/24

 

£ per week

£ per week

£ per week

Secondary threshold

170

175

175

Rates

 

2021/22

2022/23

2023/24

Employer secondary Class 1 rate above secondary threshold

13.8%

15.05% (6 April – 5 November)

13.8% (6 November – 5 April)

13.8%

For 2022/23, from 6 April until 5 November 2022, the Class 1 secondary NIC rate included an extra 1.25% prior to the planned introduction of the health and social care levy. However, the health and social care levy was abolished and never took effect.

Class 2 NIC (self-employed)

 

2021/22

2022/23

2023/24

 

£

£

£

Class 2 rate per week

3.05

3.15

3.45

Class 2 small earnings exception/small profits threshold per year

6,515

6,725

6,725

Class 2 lower profits limit per year

9,568

11,908

12,570

Special Class 2 rate for share fishermen per week

3.70

3.80

4.10

Special Class 2 rate for volunteer development workers per week

6.00

6.15

6.15

For years up to and including 2021/22, you paid Class 2 NIC if your profits are more than the small profits threshold. For 2022/23 onwards, 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.

See NIC for the self-employed.

Class 3 NIC (voluntary)

 

2021/22

2022/23

2023/24

 

£ per week

£ per week

£ per week

Class 3 rate

15.40

15.85

17.45

For more information, see our pages on National Insurance.

Class 4 NIC (self-employed)

Thresholds

 

2021/22

2022/23

2023/24

 

£ per year

£ per year

£ per year

Class 4 lower profits limit

9,568

11,908

12,570

Class 4 upper profits limit

50,270

50,270

50,270

Rates

 

2021/22

2022/23

2023/24

Class 4 rate between lower profits limit and upper profits limit

9%

9.73%

9%

Class 4 rate above upper profits limit

2%

2.73%

2%

For 2022/23 the Class 4 NIC rates included an extra 1.25% prior to the planned introduction of the health and social care levy. However, the health and social care levy was abolished and never took effect.

See NIC for the self-employed.

Capital gains tax

Rates

 

2021/22

2022/23

2023/24

Standard rate 1

10% / 18%

10% / 18%

10% / 18%

Rate for higher and additional taxpayers

20% / 28%

20% / 28%

20% / 28%

Business Asset Disposal Relief rate

10%

10%

10%

1 Capital gains tax rates of 10% and 20% for disposals on or after 6 April 2016 do not apply to transactions involving residential property or carried interest. Capital gains tax rates for these transactions are 18% and 28%.

Exemptions

 

2021/22

2022/23

2023/24

 

£

£

£

Annual exemption

12,300

12,300

6,000

Business Asset Disposal Relief lifetime limit

1m

1m

1m

See our pages on Capital gains tax.

Inheritance tax

Chargeable lifetime transfers (after exemptions) 2021/22 2022/23 2023/24
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 1 – 0% Up to £175,000 Up to £175,000 Up to £175,000
40% 2 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)

1 The residence nil rate band 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.

2 There is a reduced rate of 36% for estates that leave 10% or more to charity.

See our page on Inheritance tax.

Other rates

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

Rates and thresholds for employers: 2023 to 2024: 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 2023/24 can be found on GOV.UK.

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