The start of a new tax year on 6 April means you'll need to familiarise yourself with the tax allowances and limits for the year ahead, from the annual ISA allowance to the personal income allowance and beyond.
You can find a detailed overview of the updates for the 2019/20 tax year, including income tax, National Insurance Contributions (NIC), capital gains tax, VAT, marriage allowance, fuel duty rates and capital allowances, together with key payment dates and tax return deadlines, in our updated Tax Tables for 2019/20.
This document brings you the details of all tax allowances, brackets and thresholds for the year ahead in one place, allowing you to save it to your computer for quick and easy reference whenever required – ideal for when you're compiling your tax return. Download Tax Facts 2019/2020.
In the meantime, we thought we'd bring you a quick overview of the some of the key changes for the year ahead, to ensure you're fully informed before the tax year begins.
Income tax brackets
- The personal allowance – the amount of money you can earn before having to pay income tax – will rise to £12,500, with earnings after that level subject to income tax of 20%. The higher rate threshold will similarly increase, this time to £50,000, with the proportion of earnings after this level being taxed at 40%. The additional rate band (where 45% tax is applied) remains at £150,000 after the tax-free allowance has been deducted. Note that thresholds are different in Scotland.
- The 2019/20 ISA allowance remains at £20,000 for another year. The Junior ISA allowance, meanwhile, will rise to £4,368, up from £4,260, as will the Child Trust Fund subscription limit.
Personal savings allowance (PSA)
- The personal savings allowance, which allows you to earn interest tax-free regardless of where your money is held, remains at £1,000. This is in addition to your annual ISA allowance. If you earn more than this in interest in non-ISA accounts, make sure you disclose it to HMRC.
National Living (or minimum) Wage
- The absolute minimum that employers can legally pay their staff rose on 1 April, up from the current rate of £7.83 for those aged 25 and over to £8.21, a rise of 4.9%.
- The state pension will rise by 2.6% (average earnings growth) in April, meaning that those who qualify for the full new state pension will see their weekly payments rise from £164.35 to £168.60. This marks an increase of £4.25 a week or an additional £221 a year, with the total annual state pension income set to be £8,767.20 Alternatively, those who receive the basic state pension will see theirs rise by £3.25 a week (from £125.95 to £129.20), while those who qualify for the additional state pension will see the maximum amount they can earn rise from £172.28 to £176.41 per week.
You can find more detailed information on all of these changes, and more, in our dedicated Tax Tables for the year ahead. Click here to download your copy and make sure you're in the know.