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|
|
Income Tax
| Tax rates |
Note |
2003/04 |
2002/03 |
| Starting rate band to |
£1,960 |
£1,920 |
| Tax rate |
10% |
10% |
| Basic rate band - next |
£28,540 |
£27,980 |
| Normal rate |
22% |
22% |
| Savings income rate |
20% |
20% |
| UK dividend income rate |
10% |
10% |
| Higher rate - taxable income over |
£30,500 |
£29,900 |
| Normal rate |
40% |
40% |
| UK dividend income rate |
32.5% |
32.5% |
| Allowances that reduce taxable income |
|
|
| Personal allowance |
under 65 |
1 |
£4,615 |
£4,615 |
| |
65 to 74 |
1,3 |
£6,610 |
£6,100 |
| |
75 and over |
1,3 |
£6,720 |
£6,370 |
| |
Blind person's allowance |
|
£1,510 |
£1,480 |
| Allowances that reduce tax |
|
|
| Married couple's allowance |
|
|
|
| Tax reduction |
69 to 74 |
1,2,3 |
£556.50 |
£546.50 |
| |
75 and over |
1,2,3 |
£563.50 |
£553.50 |
| Venture Capital Trusts max. |
4 |
£100,000 |
£100,000 |
| Enterprise Investment Scheme max. |
4 |
£150,000 |
£150,000 |
| Golden Handshake max. |
|
£30,000 |
£30,000 |
| Rent a Room - exempt on gross annual rent up to |
|
£4,250 |
£4,250 |
|
Notes
- Ages are as the end of the tax year. Ages for the married couples allowance relate to the elder of husband or wife.
- The married couple's allowance is available only to those
couples where at least one spouse was born before 6 April
1935.
- The higher rates of personal allowances are reduced by
£1 for each £2 of excess income over £18,300
(2002/03 £17,900) until the basic allowance is reached.
Similar limits apply to the married couple's allowance:
the loss of tax reduction is 10p for each £2 of excess
income (only the husband's income is taken into account)
until the minimum of £215 (2002/03 £211) is
reached.
- Subscription for new ordinary shares - 20% income tax relief. Also such investments by subscription are eligible for deferral of capital gains tax on gains re-invested (up to £100,000 of gains for VCTs, unlimited for EIS).
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