|
Inheritance Tax |
2025-26 |
2024-25 |
|
Nil rate band for individuals* |
£325,000 |
£325,000 |
|
Thereafter – lifetime gifts** |
20% |
20% |
|
– lower rate on death*** |
36% |
36% |
|
– on death |
40% |
40% |
|
Residence nil rate band**** |
£175,000 |
£175,000 |
* Unused nil rate band can be used by surviving spouse or civil partner. This is currently frozen until April 2028.
** Increased to 40%, subject to tapering relief, on gifts made between 3 and 7 years pre death. Certain lifetime gifts are exempt. Special rules for business property.
*** A lower rate applies where 10% or more of the net estate is left to charity.
**** The inheritance tax main residence nil-rate band (MRNRB) was introduced in April 2017. The MRNRB allows for a £175,000 per person transferable allowance for married couples and civil partners when their main residence is passed down to children after their death. The MRNRB is in addition to the existing £325,000 inheritance tax threshold.
Net estates over £2,000,000 have RNRB reduced by £1 for every £2 and lost when estate is £2,350,000.
|
Years before death |
0-3 |
3-4 |
4-5 |
5-6 |
6-7 |
|
% of death charge |
100% |
80% |
60% |
40% |
20% |
|
Recurring annual gifts out of surplus income |
|
|
Annual gifts out of capital (with one year carry forward if unused) |
£3,000 |
|
Small gifts (per recipient) |
£250 |
|
Parental gift on marriage |
£5,000 |
|
Grandparent or party to marriage |
£2,500 |
|
Other gifts on marriage (per donor) |
£1,000 |
Business Property Relief
|
Shares in unquoted companies (including USM/AIM stocks) |
100% |
|
– shareholding up to 50% |
none |
|
– shareholding over 50% |
50% |
|
Unincorporated business or interest in a business |
100% |
|
Land, buildings, plant and machinery used in the deceased’s business/company |
50% |
National Insurance £ Rates and Allowances
|
2025-26 |
2024-25 |
|
|
Lower weekly earnings limit (primary Class 1) |
£125 |
£123 |
|
Upper weekly earnings limit (primary Class 1) |
£967 |
£967 |
|
Primary weekly earnings threshold |
£242 |
£242 |
|
Secondary weekly earnings threshold |
£96 |
£175 |
|
Employees’ primary Class 1 rate (between thresholds) |
8.00 % |
8.00 % |
|
Employees’ primary Class 1 rate (above upper limit) |
2.00 % |
2.00 % |
|
Married women’s reduced rate (between thresholds) |
1.85 % |
1.85 % |
|
Married women’s rate (above upper limit) |
2.00 % |
2.00 % |
|
Employers’ secondary Class 1 rate (above secondary threshold) |
15.00 % |
13.80 % |
|
Class 2 weekly rate – self-employed |
£3.50 |
£3.45 |
|
Class 2 small profits threshold |
£6,845 per year |
£6,725 per year |
|
Special Class 2 weekly rate – fishermen |
£4.15 |
£4.10 |
|
Special Class 2 weekly rate – volunteer development workers |
£6.25 |
£6.15 |
|
Class 3 voluntary weekly rate |
£17.75 |
£17.45 |
|
Class 4 lower profits limit |
£12,570 per year |
£12,570 per year |
|
Class 4 upper profits limit |
£50,270 per year |
£50,270 per year |
|
Class 4 rate (between limits) |
6.00 % |
6.00 % |
|
Class 4 rate (above upper limit) |
2.00 % |
2.00 % |
|
2025-26 |
2024-25 |
|
|
Annual exempt amount – Individuals |
£3,000 |
£3,000 |
|
Annual exempt amount – Trusts |
£1,500 |
£1,500 |
|
Standard rate tax for individuals (non-carried interest gains) |
18% |
18% |
|
Higher rate tax for individuals / trustees (non-carried interest gains) |
24%) |
24% |
|
Limit for gains subject to Business Asset Disposal Relief |
£1,000,000 |
£1,000,000 |
|
Business Asset Disposal Relief rate |
14% |
10% |
|
Investors’ Relief lifetime limit |
£1,000,000 |
£1,000,000 |
|
Investors’ Relief rate |
14% |
10% |
|
2025-26 |
2024-25 |
|
|
Basic element £ maximum (Working Tax Credit) |
Final year of awards £ no new claims from 6 Apr 2025 |
£2,435 |
|
Childcare element (70% of eligible costs up to) |
Final year of awards £ existing claimants only |
Up to £175/week for one child, up to £300/week for two or more children |
|
Child element per child £ maximum (Child Tax Credit) |
Final year of awards £ existing claimants only |
£3,455 |
|
Family element |
Final year of awards £ existing claimants only |
£545 |
|
Threshold for CTC only claim (income) |
Final year of awards £ existing claimants only |
£19,995 p.a. |
|
Universal Credit Childcare Element Rates |
2025-26 |
2024-25 |
|
Claimable Percentage |
85% of eligible costs |
n/a |
|
Maximum for One Child |
£1,031.88 |
n/a |
|
Maximum for Two or More Children |
£1,768.94 |
n/a |
|
The Universal Credit childcare element allows working claimants to claim back a percentage of their eligible childcare costs, up to a set monthly maximum |
||
|
Pension Contributions* |
2025-26 |
2024-25 |
|
Maximum annual contribution |
£60,000 |
£60,000 |
|
Tax on excess |
Marginal rate |
Marginal rate |
|
Normal minimum pension age |
55 |
55 |
|
|
||
|
Old State pension £ per week** |
2025-26 |
2024-25 |
|
Single person |
£176.45 |
£169.50 |
|
|
||
|
2025-26 |
2024-25 |
|
|
Single person |
£230.25 |
£221.20 |
* Tapered Annual Allowance: income threshold £200,000 and adjusted income threshold £260,000, reducing the allowance down to a minimum of £10,000 for higher earners.
Income Tax
|
Bands |
2025-26 |
2024-25 |
|
Savings starting rate £ 0%* |
£0 £ £5,000 |
£0 £ £5,000 |
|
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 |
|
|
||
|
Scottish rates |
2025-26 |
2024-25 |
|
Starter rate 19% on taxable income |
£12,571 – £15,397 |
£12,571 £ £14,876 |
|
Basic rate 20% |
£15,398 – £27,491 |
£12,571 – £15,397 |
|
Intermediate rate – 21% |
£27,492 – £43,662 |
£6,562 £ £43,662 |
|
Higher rate – 42% |
£43,663 – £75,000 |
£43,663 – £75,000 |
|
Advanced -45% |
£75,001 – £125,140 |
£75,001 – £125,140 |
|
Top rate – 48% |
Above £125,140 |
Above £125,140 |
|
2025-26 |
2024-25 |
|
|
Dividend allowance |
£500 |
£500 |
|
Dividend ordinary rate |
8.75% |
8.75% |
|
Dividend upper rate |
33.75% |
33.75% |
|
Dividend additional rate |
39.35% |
39.35% |
|
Personal savings allowance |
2025-26 |
2024-25 |
|
– basic rate taxpayers |
£1,000 |
£1,000 |
|
– higher rate taxpayers |
£500 |
£500 |
|
Reliefs |
2025-26 |
2024-25 |
|
Personal allowance |
£12,570 |
£12,570 |
|
Registered blind person£s allowance |
£3,130 |
£3,070 |
|
Income limit for personal allowance* |
£100,000 |
£100,000 |
* The personal allowance is gradually withdrawn by £1 for every £2 of income over £100,000.
|
Married couple allowance £ tax relief given at 10% |
2025-26 |
2024-25 |
|
– Born before 6 April 1935 |
£11,270 |
£11,080 |
|
– Minimum amount* |
£4,360 |
£4,280 |
|
– Income limit |
£37,700 |
£37,000 |
|
– Marriage allowance* |
£1,260 |
£1,260 |
* Since 2021/22 a taxpayer can transfer up to £1260 of their unused personal allowance to a spouse or civil partner who is not a higher rate taxpayer.
|
High Income Child Benefit Charge* |
2025-26 |
2024-25 |
|
on income over |
£60,000 |
£60,000 |
* From 6 April 2024, the tax charge is levied at the rate of 1% of the full child benefit award for each £100 that income exceeds £60,000, up to a maximum of 100% of the child benefit claimed. The child benefit is withdrawn in full once an individual£s income exceeds £80,000.
Taxpayers can choose whether to continue receiving child benefit and pay the tax charge or may opt out of receiving the child benefit.
Stamp Duty on shares (SDRT): 0.5% on purchases of UK shares.
Annual Tax on Enveloped Dwellings (ATED): Payable by certain non‑natural persons owning UK residential properties valued over £500,000. Charges start at £4,450 for properties up to £1 million and increase in bands for higher‑value properties.
England & Northern Ireland £ Stamp Duty Land Tax (SDLT) £ Standard Residential Property.
|
Purchase price (portion) |
Rate |
|
£0 – £125,000 |
0% |
|
£125,001 – £250,000 |
2% |
|
£250,001 – £925,000 |
5% |
|
£925,001 – £1,500,000 |
10% |
|
Over £1,500,000 |
12% |
Additional notes:
SDLT on non-residential and mixed-use properties.
|
Rate |
Non-Residential Property |
|
Zero |
£0 £ £150,000 |
|
2% |
£150,001 £ £250,000 |
|
5% |
Over £250,000 |
These rates are applied on a graduated basis with the portion of the purchase price within each tier charged at the applicable rate.
15% is applied to residential properties held in a £corporate envelope£ costing over £500,000.
There is a higher rate of SDLT that applies to purchases of additional residential property such as buy to let and second homes. The rate is 3% higher than the current SDLT rates and applies to the purchase of additional residential properties valued at £40,000 and above.
Scotland £ Land & Buildings Transaction Tax (LBTT) £ Residential Property.
|
Purchase price (portion) |
Rate |
|
£0 – £145,000 |
0% |
|
£145,001 – £250,000 |
2% |
|
£250,001 – £325,000 |
5% |
|
£325,001 – £750,000 |
10% |
|
Over £750,000 |
12% |
Additional notes:
Non-Residential and mixed-use properties.
|
Rate |
Non-Residential Property |
|
Zero |
£0 £ £150,000 |
|
1% |
£150,001 £ £250,000 |
|
5% |
Over £250,000 |
Wales – Land Transaction Tax (LTT) £ Residential Property
|
Purchase price (portion) |
Rate |
|
£0 – £225,000 |
0% |
|
£225,001 – £400,000 |
6% |
|
£400,001 – £750,000 |
7.5% |
|
£750,001 – £1,500,000 |
10% |
|
Over £1,500,000 |
12% |
Additional notes:
Non-Residential and mixed-use properties.
|
Rate |
Non-Residential Property |
|
Zero |
£0 £ £225,000 |
|
1% |
£225,001 £ £250,000 |
|
5% |
£250,001 £ £1,000,000 |
|
6% |
Over £1,000,000 |
These rates are applied on a graduated basis with the portion of the purchase price within each tier charged at the applicable rate.
The National Minimum Wage and Living Wage
|
2025-26 |
2024-25 |
|
|
National Living Wage Aged 21 and over |
£12.21 p.h. |
£11.44 p.h. |
|
National Minimum Wage Aged 18 to 20 |
£10.00 p.h. |
£8.60 p.h. |
|
Aged 16 and 17 |
£7.55 p.h. |
£6.40 p.h. |
|
Apprentice rate |
£7.55 p.h. |
£6.40 p.h. |
VAT
|
Rates and Limits |
2025-26 |
2024-25 |
|
Standard rate |
20% |
20% |
|
Reduced rate |
5% |
5% |
|
Zero rate |
0% |
0% |
|
Annual registration limit (from 1 April 2025) |
£90,000 |
£90,000 |
|
Annual deregistration limit (from 1 April 2025) |
£88,000 |
£88,000 |
|
VAT Cash accounting scheme threshold |
£1,350,000 |
£1,350,000 |
|
VAT Annual accounting scheme threshold |
£1,350,000 |
£1,350,000 |
Corporation Tax
|
2025-26 |
2024-25 |
|
|
Small profits rate (0 – 50,000) |
19% |
19% |
|
Marginal rate (50,001 – 250,000) |
26.5% |
26.5% |
|
Main rate (Over 250,000) |
25% |
25% |
Marginal relief fraction (3/200)
Corporation tax rates are set for each Financial Year. A Financial Year runs from 1 April to the following 31 March.
If the accounting period of a company straddles the 31 March, the profits are apportioned on a time basis to each Financial Year.
For the year to 31.3.24 the profits limits are reduced for a company with associated companies. Different rates apply for ring-fenced (broadly oil industry) profit.
Tax – Car, Van and Fuel Benefits
|
Company Car Tax BIK Rates £ Cars registered from 6th April 2020 |
||||
|
CO₂ emissions (g/km) |
Electric range (miles) |
2025/26 BIK |
2024/25 (%) |
Notes |
|
0 |
N/A |
3% |
2% |
Fully electric |
|
1-50 |
>130 |
3% |
2% |
Plug-in hybrid, long range |
|
1-50 |
70£129 |
6% |
5% |
Plug-in hybrid |
|
1-50 |
40£69 |
9% |
8% |
Plug-in hybrid |
|
1-50 |
30£39 |
13% |
12% |
Plug-in hybrid |
|
1-50 |
<30 |
15% |
14% |
Plug-in hybrid |
|
51-54 |
– |
16% |
15% |
Petrol or diesel |
|
55-59 |
– |
17% |
16% |
– |
|
60-64 |
– |
18% |
17% |
– |
|
65-69 |
– |
19% |
18% |
– |
|
70-74 |
– |
20% |
19% |
– |
|
75-79 |
– |
21% |
20% |
– |
|
80-84 |
– |
22% |
21% |
– |
|
85-89 |
– |
23% |
22% |
– |
|
90-94 |
– |
24% |
23% |
– |
|
95-99 |
– |
25% |
24% |
– |
|
100-104 |
– |
26% |
25% |
– |
|
105-109 |
– |
27% |
26% |
– |
|
110-114 |
– |
28% |
27% |
– |
|
115-119 |
– |
29% |
28% |
– |
|
120-124 |
– |
30% |
29% |
– |
|
125-129 |
– |
31% |
30% |
– |
|
130-134 |
– |
32% |
31% |
– |
|
135-139 |
– |
33% |
32% |
– |
|
140-144 |
– |
34% |
33% |
– |
|
145-149 |
– |
35% |
34% |
– |
|
150-154 |
– |
36% |
35% |
– |
|
155-159 |
– |
37% |
36% |
Max BIK |
|
160+ |
– |
37% |
37% |
Max BIK |
Mileage Allowance Payments
|
Cars & vans |
Rate per mile 2025-26 |
|
– up to 10,000 miles |
45p |
|
– over 10,000 miles |
25p |
|
Motorcycles |
24p |
|
Bicycles |
20p |
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
|
2025-26 |
2024-25 |
|
|
£ Main writing down allowance |
18% |
18% |
|
£ Long life assets, integral fixtures |
6% |
6% |
|
£ First year allowances (certain environmentally efficient products) |
100% FYA Or 50% FYA for special rate expenditure |
100% FYA Or 50% FYA for special rate expenditure |
The Annual investment Allowance of £1,000,000 continues.
|
Cars |
2025-26 |
2024-25 |
|
-CO2 emissions |
||
|
0 g/km or below |
100% FYA |
100% FYA |
|
1 – 50 g/km |
18% WDA – Main pool |
18% WDA – Main pool |
|
Above 50 |
6% WDA – Special pool |
6% WDA – Special pool |
Tax Favoured Investments
|
Investment type |
Annual limit |
Income tax relief |
Notes |
|
Adult ISA |
£20,000 |
Tax‑free growth (income +
gains) |
Includes LISA/JISA allowances. |
|
Lifetime ISA (LISA) |
£4,000 |
25%
bonus on contributions |
Age
restrictions apply. |
|
Junior ISA (JISA) |
£9,000 |
Tax‑free growth for children |
|
|
VCT |
£200,000 per year |
30%
relief on investment |
Dividends
tax‑free; holding period 5 years. |
|
EIS |
£1,000,000 (or up to £2,000,000
if at least £1m in £knowledge‑intensive£ companies) per year |
30% relief on investment |
CGT deferral, etc. |
|
SEIS |
£200,000 per year |
50%
relief on investment |
Very
small companies; additional CGT relief. |
