Emergency Budget 2010 Update

PERSONAL TAXATION	2010/11	2009/10
Personal allowance
general	£6,475*	£6,475
aged 65 or over in year of assessment	£9,490	£9,490
aged 75 or over in year of assessment	£9,640	£9,640
age allowance income limit	£22,900	£22,900
minimum where income exceeds limit	£6,475	£6,475
Married couple’s allowance (10% relief)
either partner born before 6 April 1935	N/A	N/A
either partner aged 75 or over in year of assessment	£6,965	£6,965
age allowance income limit	£22,900	£22,900
minimum where income exceeds limit	£2,670	£2,670
Blind person’s allowance	£1,890	£1,890
Income tax rates
Starting savings rate	10%	10%
on income up to	£2,440**	£2,440**
Basic rate	20%	20%
on taxable income up to	£37,400	£37,400
Higher rate	40%	40%
on taxable income over	£37,400	£37,400
Additional rate	50%	N/A
on taxable income over	£150,000	N/A
Lower rate on dividend income	10%	10%
Higher rate on dividend income	32.5%	32.5%
Additional rate on dividend income	42.5%	N/A
Pension schemes allowances
Annual allowance	£255,000	£245,000
Lifetime allowance	£1,800,000	£1,750,000
*For 2010/11 the personal allowance is withdrawn at a rate of £1 for every £2 of income above £100,000. **Starting rate applies only to savings income. If taxable non-savings income is above this limit, the starting rate is not applicable.
COMPANY TAXATION	FY2010	FY2009
Corporation tax rates
All companies (except below)	28%	28%
Companies with small profits	21%	21%
– 21% rate limit	£300,000	£300,000
– marginal relief limit	£1,500,000	£1,500,000
– marginal relief fraction	7/400	7/400
– marginal rate	29.75%	29.75%
CAPITAL GAINS TAX	Before 23.6.10	After 22.6.10
Rate – standard rate	18%*	18%*
–higher rate	18%*	28%*
–trustees and personal representatives	18%*	28%*
General exemption limit	£10,100	£10,100
*subject to available reliefs
INHERITANCE TAX		Transfers after 5/4/2009
Threshold		£325,000
Death rate		40%
VAT
Standard rate after 3 January 2011		20%
Standard rate 1 Jan 2010 to 3 Jan 2011		17.5%
Registration threshold after 31 March 2010		£70,000
(previously £68,000 after 30 April 2009)
NATIONAL INSURANCE		2010/11
(2009/10 in brackets where different)
Class 1 contributions
Not contracted out
The employee contribution is 11% of earnings between £110 and £844 p.w. plus 1% of all earnings above £844 p.w. The employer contribution is 12.8% of all earnings in excess of the first £110 p.w.
Contracted out
The `not contracted out’ rates for employees are reduced on the band of earnings from £110 p.w. to £770 p.w. by 1.6%. For employers, they are reduced on the band of earnings from £110 p.w. to £770 p.w. by 3.7% for employees in salary-related schemes or 1.4% for employees in money purchase schemes. In addition, there is an employee rebate of 1.6% and an employer rebate of 3.7% or 1.4%, as appropriate, on earnings from £97 (£95) p.w. up to £110 p.w.
Class 1A and 1B contributions		12.8%
Class 2 contributions
Flat weekly rate		£2.40
Exemption limit		£5,075
Class 3 contributions
Flat weekly rate		£12.05
Class 4 contributions
8% on the band of profits between £5,715 and £43,875 plus 1% on all profits above £43,875. Note: It must be remembered that these proposals are subject to amendment during the passage of the Finance Bill.