Tax Rates & Thresholds 2019/2020

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As we approach the busiest time of year in the financial calendar, we provide a reminder of the key rates and thresholds applicable to those working in England and Northern Ireland.

PAYE Tax Rates and Thresholds

Employee personal allowance	£240 per week £1,042 per month £12,500 per year
Basic tax rate	20% on annual earnings above the PAYE tax threshold and up to £37,500
Higher tax rate	40% on annual earnings from £37.500 to £150,000
Additional tax rate	45% on annual earnings above £150,000

INCOME LIMITS FOR TAPERING

The amount of gross income you can have before your personal allowance is reduced.

Income Limit (Born after 5 April 1948)	£100,000
Income Limit (Born before 6 April 1948) *	£29,600

Class 1 National Insurance Thresholds

You can only make National Insurance deductions on earnings above the Lower Earnings Limit (LEL).

LEL	£118 per week
Primary Threshold (PT)	£166 per week
Secondary Threshold (ST)	£166 per week
Upper Secondary Threshold (under 21) (UST)	£962 per week
Apprentice Upper Secondary Threshold (apprentice under 25) (AUST)	£962 per week
Upper Earnings Limit (UEL)	£962 per week

Class 1 National Insurance Rates (Employee contribution rates)

These are deducted from an employee’s pay via PAYE.

National Insurance category letter	Earnings at or above LEL up to and including PT	Earnings above the PT up to and including UEL	Balance of earnings above UEL
A	0%	12%	2%
B	0%	5.85%	2%
C	nil	nil	nil
H (Apprentice under 25)	0%	12%	2%
J	0%	2%	2%
M (under 21)	0%	12%	2%
Z (under 21 – deferment)	0%	2%	2%

Class 1 National Insurance Rates (Employer contribution rates)

Paid to HMRC as part of your PAYE bill.

National Insurance category letter	Earnings at or above LEL up to and including ST	Earnings above ST up to and including UEL/UST/AUST	Balance of earnings above UEL/UST/AUST
A	0%	13.80%	13.80%
B	0%	13.80%	13.80%
C	0%	13.80%	13.80%
H (Apprentice under 25)	0%	0%	13.80%
J	0%	13.80%	13.80%
M (under 21)	0%	0%	13.80%
Z (under 21 – deferment)	0%	0%	13.80%

Self Employed Class 2 and Class 4 NICs

Class 4 Lower Profits Limit (Annual)	£8,632
Class 4 Upper Profits Limit (Annual)	£50,000
Class 4 Rate Between Lower and Upper Profits	9%
Class 4 Rate Above Upper Profits	2%
Class 2 Earnings Exception Limit	£6,365
Class 2 Weekly Amount	£3.00
Class 2 Weekly Amount (Share Fisherman)	£3.65
Class 2 Weekly Amount (Volunteer Development Workers)	£5.90

DIVIDEND TAX BANDS AND PERCENTAGES

You only pay tax on dividends that go above your dividend allowance in the tax year. The allowance for 2019/2020 is £2,000.

Band	Limits	Percentage
Basic Rate	£0 – £37,500	7.5%
Higher Rate	£37,501- £150,000	32.5%
Additional/Top Rate	Over £150,000	38.1%

Corporation Tax Rates and Limits

Main Rate

19%

Capital Gains Tax Rates and Annual Exempt Amounts

Annual Exempt Amount – Individuals, Personal Reps and Trustees for Disable People	£12,000
Annual Exempt Amount – Other Trustees	£6,000
CGT Tax Rates
Individuals – Basic Rate Taxpayer (Residential Property)	18%
Individuals – Higher Rate Taxpayer (Residential Property)	28%
Individuals – Basic Rate Taxpayer (Other Gains)	10%
Individuals – Higher Rate Taxpayer (Other Gains)	20%
Personal Representative of a Deceased Individual (Residential Property)	28%
Personal Representative of a Deceased Individual (Other Gains)	20%
Gains Qualifying for Entrepreneurs’ Relief	10%

Articles on this website are offered only for general informational and educational purposes. They are not offered as, and do not constitute, financial advice. You should not act or rely on any information contained in this website without first seeking advice from a professional.

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Sources:
https://www.uktaxcalculators.co.uk/tax-rates/2019-2020/
https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2019-to-2020#tax-thresholds-rates-and-codes