Knowledge base

Tax Thresholds in the UK

Dear Taxpayer, below you will find all the tax thresholds applicable in the United Kingdom. If anything is unclear, you can always ask our accountants for further clarification.
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Income Tax,
a tax on individuals.

Tax year 2024 to 2025
Tax year 2023 to 2024
Basic rate 20%
£12,571 - £50,270
£12,571 - £50,270
Higher rate 40%
£50,271 - £125,140
£50,271 - £125,140
Additional rate 45%
Over £125,140
Over £125,140
Personal allowance
£12,570
£12,570
Income limit for personal allowance
£100,000
£100,000

Dividends,
a tax on dividends.

Tax year 2024 to 2025
Tax year 2023 to 2024
Dividend at the basic rate
8.75%
8.75%
Dividend at the higher rate
33.75%
33.75%
Dividend at the additional rate
39.35%
39.35%
Dividend allowance
£500
£1,000

Marriage Allowance,
a tax relief for couples.

Tax year 2024 to 2025
Tax year 2023 to 2024
Marriage limit amount
£1,260
£1,260

Self-employed Rates & Threshold,
thresholds and social security rates.

Tax year 2024 to 2025
Tax year 2023 to 2024
Small Profits Threshold (SPT)
£6,725 per year
£6,725 per year
Class 2 Contribution Rates
Below SPT/week
£3.45 (voluntary)
£3.45 (voluntary)
Above LPT/week
£0.00
£3.45
Special Class 2 volunteer develop. workers
£6.15
£6.15
Lower Profits Limit (LPL)
£12,570
£12,570
LPL - increasing 6 July 2022
£12,570
Upper Profits Limit (UPL)
£50,270
£50,270
At Spring Statement 2022, it was announced that self-employed individuals earning between the Small Profits Threshold and the Lower Profits Limit would not pay Class 2 National Insurance contributions while continuing to build up entitlement to contributory benefits.
Class 4 Contribution Rates
Annual Profits Band
NIC rate (%)
NIC rate (%)
Below LPL
0
0
LPL to UPL
6
9
Above UPL
2
2

Capital Gains Tax,a tax on capital gains.

Tax year 2024 to 2025
Tax year 2023 to 2024
Main rates for individuals
10% / 20%
10% / 20%
Rates for individuals (for gains on residential property not eligible for Private Residence Relief, and carried interest)
18% / 24% / 28%
18% / 28%
Annual exempt amount (AEA) for individuals and personal representatives
£3,000
£6,000

Corporation Tax Rate,
the corporate tax.

Tax year 2024 to 2025
Tax year 2023 to 2024
Small Profits Rate
19%
19%
Main Rate
25%
25%
Small Profits Limit
£50,000
£50,000
Marginal Relief Lower Limit
£50,000
£50,000
Marginal Relief Upper Limit
£250,000
£250,000
Marginal Relief Fraction  
3/200
3/200

Capital Allowances,
a relief for the purchase of fixed assets (investments).

Tax year 2024 to 2025
Tax year 2023 to 2024
Plant and machinery: main rate expenditure
18%
18%
Plant and machinery: special rate expenditure
6%
6%
Annual Investment Allowance (AIA)
£1,000,000
£1,000,000
Full Expensing: 100% First Year Allowances
100%
100%

VAT Registration and Deregistration Thresholds,
i.e. VAT registration thresholds.

From April 2024
From April 2023
VAT registration thresholds
£90,000
£85,000
VAT deregistration threshold
£88,000
£83,000

VAT Rates,
turnover tax.

April 2024 to 2025
April 2023 to 2024
Standard rate
20%
20%
Reduced rate
5%
5%
Zero rate
0%
0%
Exempt
N/A
N/A

Mileage,
flat rates for business trips.

April 2024 to 2025
April 2023 to 2024
Car
For tax purposes: 45p for the first 10,000 business miles in a tax year, then 25p for each subsequent mile
For NICs purposes: 45p for all business miles
For tax purposes: 45p for the first 10,000 business miles in a tax year, then 25p for each subsequent mile
For NICs purposes: 45p for all business miles
Motorcycle
24p for both tax and NICs purposes and for all business miles
24p for both tax and NICs purposes and for all business miles
Cycle
20p for both tax and NICs purposes and for all business miles
20p for both tax and NICs purposes and for all business miles

National Minimum Wages,
the minimum wage.

April 2024 to 2025
April 2023 to 2024
Age
Hourly Wage
Hourly Wage
23 and over national living wage rate
£11.44
£10.42
21 to 22
£11.44
£10.18
18 to 20
£8.60
£7.49
Under 18
£6.40
£5.28
Apprentices
£6.40
£5.28
Sources:
 https://www.gov.uk/government/publications/spring-budget-2024-overview-of-tax-legislation-and-rates-ootlar/annex-a-rates-and-allowances
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