Budget 2013 – Annual Tax Rates and Allowances
A look at some of the key business announcements for 2013's budget
On 20 March the Chancellor announced his Budget for the coming year. The key announcements covered:
- A reduction in the corporation tax rate to 20% from April 2015
- A £2,000 employment allowance from April 2014
- A new capital gains tax relief on the sale of a controlling interest in a business from 2014
- Income tax and National Insurance relief on shares for employee shareholders from 1 September 2013
- An increase in the new above the line research and development tax credit to 10% from 1 April 2013
- The removal of Stamp Duty on shares traded in growth markets such as AIM and ISDX Growth Market from April 2014
NOTE: The figures contained in this article are subject to amendment as the Finance Bills pass through Parliament. This article is a guide only and advice should be taken before acting on its contents.
Income Tax Rates
| Rate (%) | 2013/2014 (£) | 2012/2013 (£) |
|---|---|---|
| 1012 | 1-2,790 | 1-2,710 |
| 203 | 1-32,010 | 1-34,370 |
| 404 | 32,011-150,000 | 34,371-150,000 |
| 45/505 | over 150,000 | over 150,000 |
- Savings income (excluding dividends) is taxed at 10% within the savings rate band.
- Rate applicable to discretionary and accumulation and maintenance trusts for 2013/14 is 45% (50% for 2012/13) above standard rate band of £1,000; within the standard rate band the tax rate is 10% or 20% depending on nature of income.
- See also Taxation of Dividends.
1 Only available to extent taxable non-savings income is less than savings rate band
2 Savings rate band
3 Basic rate band
4 Higher rate band
5 Additional rate band
Personal Allowances
| 2013/2014 (£) | 2012/2013 (£) | |
|---|---|---|
| Personal1 | ||
| Born after 5 April 1948 | 9,440 | n/a |
| Age under 65 | n/a | 8,105 |
| Born after 5 April 1938 but before 6 April 1948 | 10,500 | n/a |
| Age 65-74 | n/a | 10,500 |
| Born before 6 April 1938 | 10,660 | n/a |
| Age 75 and over | n/a | 10,660 |
| Married couples2345 |
7,915
|
7,705
|
| Blind person’s 6 | 2,160 | 2,100 |
1Age related personal allowances reduced by £1 for every £2 of income above the limit of £26,100 (£25,400 2012/13) until the basic personal allowance of £9,440 (£8,105 2012/13) is reached. Basic personal allowance reduced by £1 for every £2 of income over £100,000 until completely removed.
2 Relief is restricted to 10%.
3 Part or the full amount of the allowance may be transferred to the spouse (wife for marriages pre 5 December 2005) or civil partner.
4 Available where at least one of the parties was born pre 6 April 1935.
5 Married couples’ allowance reduced by £1 for every £2 income in excess of £26,100 (£25,400 2012/13) until minimum allowance of £3,040 (£2,960 2012/2013) is reached.
6 Any surplus can be transferred to the spouse or civil partner.
