Income tax – for 2013/14 the personal allowance increases to £9440 for those aged under 65, £10500 for 65-74’s, and £10660 for those aged 75 and over. The next £32010 will be subject to tax of 20%, income between £41450 and £150000 will be taxed at 40%. Income over £150000 will be taxed at 45%. Where income exceeds £100000, the personal allowance is reduced by £1 for every £2 of income above £100000.
National Insurance – for the self-employed, class 2’s increase from £2.65 to £2.70 per week from April 2013. Class 4’s are 9% on profits between £7755 and £41450. For employees, the rate is 12% of earnings between £149 and £797 per week, and 2% above £797. Employers N.I. is 13.8% on employees earnings above £148 per week.
Corporation tax – from 1.4.13 the small companies rate remains at 20% (on the first £300k of profit). The large companies rate drops from 24% to 23% from April 2013, 23% to 21% from April 2014, and 21% to 20% from April 2015. Large companies are those where profits exceed £1.5m. There are marginal rates of tax on profits between £300k and £1.5m.
VAT – from 1.4.13 the registration limit increases from £77000 to £79000.
Capital allowances – the Annual Investment Allowance increased from £25000 to £250000 from 1.1.13 for a period of 2 years only. Writing down allowances remain at 18% (main rate) and 8% (lower rate including cars above 130 g/km CO2 emissions). A rate of 100% is available for cars below 96g/km and certain energy efficient plant.
Capital Gains Tax – the annual allowance for individuals increases to £10900 from April 2013. The CGT rate remains at 18% (or 28% if the gain takes you into the higher rate band). The Entrepreneurs relief rate stays at 10% for the sale of businesses for the first £10 million of lifetime gains.
Inheritance tax – the nil rate band of £325000 (£650000 for married couples and civil partners) remains the same.
Business mileage – rates remain the same at 45p for the first 10000 miles, and 25p per mile on those miles exceeding 10000.
ISA’s – for 2013/14 the cash allowance is £5760 per person.
Future – the personal allowance is set to increase to £10000 in April 2014. A National Insurance subsidy for employers of up to £2000 will commence in April 2014.
