Tax Rates & Tables

Authorised Mileage Rates:

Cars Bicycles: Motorcycles:

up to 10,000 miles - 40p over 10,000 miles - 25p 20p 24p

These rates represent the maximum tax-free mileage allowances for employees using their own vehicles for business. Any excess is taxable. If the employee receives less than the statutory rate, tax relief can be claimed on the difference.

Capital Allowances:

	Writing Down Allowance
Plant and machinery* Motor cars Industrial buildings Agricultural buildings Hotels	25% # reducing balance 25% reducing balance (£3,000 max) 4% (straight line) 4% (straight line) 4% (straight line)

*For small businesses: first year allowances (FYAs) of 50% for 24 months from 6.4.06 (1.4.06 for companies). 40% otherwise.

For medium-sized businesses: FYAs of 40%.

For all businesses: 100% FYAs on expenditure on energy saving plant and machinery.

**100% FYAs on new cars with CO2 emissions not exceeding 120 gm/km until 31.3.08.
# 6% on certain life long assets.

Capital Gains Tax:

		2007/08	2006/07
Individuals	- exemption	£9,200	£8,800

 Balance of gains (reduced by taper relief) charged as top slice of income (at savings rates - ie 10%, 20% or 40%)

Trusts	- exemption	£4,600	£4,400
	- balance of gains (reduced by taper relief)	40%	40%

Taper relief 2007/08 and 2006/07 disposals
Percentage relief depends on number of complete years asset owned after 5.4.98.

Years of ownership	1	2	3	4	5	6	7	8	9	10
Business assets (% relief)	50	75	75	75	75	75	75	75	75	75
Non-business assets* (% relief)	0	0	5	10	15	20	25	30	35	40

*Add one extra year if asset owned before 17.3.98 (subject to overriding max. of 40%)..

Car & Fuel Benefits:

Company cars 2007/08 and 2006/07

CO2 emissions (gm/km) (round down to nearest 5gm/km)	% of car’s list price taxed	Fuel benefit (£14,400 x %)
up to 140	15	2,160
145	16	2,304
150	17	2,448
155	18	2,592
160	19	2,736
165	20	2,880
170	21	3,024
175	22	3,168
180	23	3,312
185	24	3,456
190	25	3,600
195	26	3,744
200	27	3,888
205	28	4,032
210	29	4,176
215	30	4,320
220	31	4,464
225	32	4,608
230	33	4,752
235	34	4,896
240 and above	35	5,040

Company cars

• For diesel cars add a 3% supplement, but maximum still 35%. This is waived for Euro IV diesels. For        2006/07, no waiver for diesels registered on/after 1 January 2006.
• Discounts apply to certain environmentally friendly cars.
• For cars registered before 1.1.98 charge is based on engine size.
• The list price includes accessories and is subject to an upper limit of £80,000.
• List price is reduced for capital contributions made by the employee up to £5,000. 

Fuel benefits

• The fuel benefit charge is proportionately reduced if provision of private fuel ceases part way through the    year.
• The fuel benefit is reduced to nil only if the employee pays for all private fuel.

Van benefit per vehicle

2007/08	2006/07
Van Benefit £3,000	Under 4 years old £500
Fuel Benefit £500	At least 4 years old £350

Notes
1. The charges will not apply if a "restricted private use condition" is met throughout the tax year.
2. Van benefits include fuel for private use. 

Corporation Tax: 

	Years to 31.3.08		Years to 31.3.07
	Profits Band £	Rate %	Profits Band £	Rate %
Small companies rate	0 - 300,000	20	0 - 300,000	19
Marginal (small companies) rate	300,001 - 1,500,000	32.50	300,001 - 1,500,000	32.75
Full rate	Over 1,500,000	30	Over 1,500,000	30
Small companies fraction		1/40		11/40

The profits limits are reduced for accounting periods of less than 12 months and for a company with associated companies.

Income Tax Rates:

2007/08		2006/07
Band £	Rate %	Band £	Rate %
0 - 2,230	10	0 - 2,150	10
2,231 - 34,600	22*	2,151 - 33,300	22*
Over 34,600	40**	Over 33,300	40**

* Except dividends (10%) and savings income (20%).

** Except dividends (32.5%).

Other income taxed first, then savings income and finally dividends.

Income Tax Reliefs:

		2007/08 £	2006/07 £
Personal allowance	- under 65	5,225	5,035
	- 65 - 74 *	7,550	7,280
	- 75 and over *	7,690	7,420
	- aged less than 75 and born before 6.4.35 *	6,285	6,065
Married couple's allowance (relief at 10%)
	- 75 and over*	6,365	6,135
	- min. amount	2,440	2,350
* Age allowance income limit		20,900	20,100
(reduce age allowance by £1 for every £2 of excess income over £20,900)
Blind person’s allowance		1,730	1,660

Inheritance Tax:

		Chargeable Transfers
Death Rate %	Lifetime Rate %	2007/08 £’000	2006/07 £’000
Nil	Nil	0 - 300	0 - 285
40	20	Over 300	Over 285

Reliefs:
Annual exemption	£3,000	Marriage	- parent	£5,000
Small gifts	£250		- grandparent	£2,500
			- bride/groom	£2,500
			- other	£1,000

Reduced charge on gifts within seven years of death:

Years before death	0-3	3-4	4-5	5-6	6-7
% of death charge	100	80	60	40	20

ISAs:

2007/08 and 2006/07
			£
Overall	- maxi ISA		7,000
investment
limit	- mini ISA	- stocks, shares and life insurance	4,000
		- cash	3,000

National Insurance:

Class 1 (employed) Contracted in
	2007/08 Rates
Weekly earnings	Employer	Employee
Up to £100	Nil*	Nil*
£100.01 - £670	12.8%**	11%**
Over £670	12.8%**	£62.70 +1%†

 * Entitlement to contribution-based benefits retained for earnings between £87.01 and £100 per week.

** On earnings above £100.

† On earnings above £670.

Class 1A (employers)	12.8% on employee taxable benefits
Class 1B (employers)	12.8% on PAYE Settlement Agreements
Class 2 (self-employed)	flat rate per week £2.20 small earnings exception p.a. £4,635
Class 3 (voluntary)	flat rate per week £7.80
Class 4 (self-employed)	8% on profits between £5,225 and £34,840 plus 1% on profits over £34,840

Pension Premiums (2007/08 and 2006/07):

• Tax relief available for personal contributions: higher of £3,600 (gross) or 100% of relevant earnings.
• Employers will obtain tax relief on employer contributions if they are paid and made 'wholly and exclusively'.
• Tax relief for large contributions may be spread over several years.
• Any contributions in excess of £225,000 (£215,000), whether personal or by the employer, will be subject to income tax on the individual at 40%.
• No carry back of pensions contributions.

Social Security Benefits:

		Weekly Benefit
		2007/08	2006/07
Basic retirement pension	- single person	£87.30	£84.25
	- married couple	£139.60	£134.75
Statutory pay rates - average weekly earnings £87 (£84) or over
Statutory Sick Pay		£72.55	£70.05
Statutory Maternity Pay
- first six weeks		90% of weekly earnings
- next 33 weeks**		£112.75*	£108.85*
Statutory Paternity Pay - two weeks		£112.75*	£108.85*
Statutory Adoption Pay - 39 weeks**		£112.75*	£108.85*

* Or 90% of weekly earnings if lower
** For children due/placed from 1 April 2007.

Stamp Duty:

Land and buildings (On full consideration paid)
Rate	Residential property		Non-residential
	Disadvantaged areas	Other
	£	£	£
Nil	0 - 150,000	0 - 125,000*	0 - 150,000
1%	150,001 - 250,000	125,001 - 250,000	150,001 - 250,000
3%	250,001 - 500,000	250,001 - 500,000	250,001 - 500,000
4%	Over 500,000	Over 500,000	Over 500,000

*Shares and securities - rate 0.5%

Tax Credits:

	2007/08 £	2006/07 £
Working Tax Credit (WTC)
Basic element - max.	1,730	1,665

Childcare element
80% of eligible costs up to £175 per week (£300 if two or more children)

Child Tax Credit (CTC)
Child element per child - max.	1,845	1,765
Family element	545	545
Baby addition	545	545

Reductions in maximum rates 37% of income above £5,220*p.a.

*If only CTC is claimed, the threshold is £14,495 p.a. (£14,155). The family element of CTC is not reduced unless income is more than £50,000 p.a. when it is reduced by £1 for every £15 of additional income.

VAT:

Standard Rate	17.5%
Reduced Rate	5%
Annual Registration Limit - from 1.4.07 (1.4.06 - 31.3.07 £61,000)	£64,000
Annual Deregistration Limit - from 1.4.07 (1.4.06 - 31.3.07 £59,000)	£62,000

Flat Rate Scheme - allows businesses to calculate their VAT payment as a percentage of their VAT inclusive turnover.
Limits - annual VAT exclusive taxable turnover does not exceed £150,000 and total VAT exclusive annual turnover does not exceed £187,500. Leave on anniversary of scheme where total VAT inclusive annual turnover exceeds £225,000.

Cash Accounting - allows businesses to account for input and output VAT on a paid and received basis.
Limits from 1 April 2007 - where annual VAT exclusive taxable turnover does not exceed £1,350,000. Leave at end of a VAT period where annual VAT exclusive taxable turnover exceeds £1,600,000.

Annual Accounting - allows businesses to smooth out cash flow by paying a set amount, either monthly or quarterly. Only one VAT return due a year.
Limits - where annual VAT exclusive taxable turnover does not exceed £1,350,000.