Ellis Bates Financial Advisers
The UK tax system is notoriously complex, but the benefits of structuring your finances tax efficiently can be significant.
We work with you to ensure you maximise all tax relief available and to look at all your current and future finances to mitigate a whole range of liabilities such as income tax, VAT and corporation tax.
| 2022/23 | Band | 2023/24 | Band |
| Basic rate: 20% | £0 – £37,700 | Basic rate: 20% | £0 – £37,700 |
| Higher rate: 40% | £37,701 – £150,000 | Higher rate: 40% | £37,701 – £125,140 |
| Additional rate: 45% | Over £150,000 | Additional rate: 45% | Over £125,140 |
| 2022/23 | Band | 2023/24 | Band |
| Starter rate: 19% | £0 – £2,162 | Starter rate: 19% | £0 – £2,162 |
| Basic rate: 20% | £2,163 – £13,118 | Basic rate: 20% | £2,163 – £13,118 |
| Intermediate rate: 21% | £13,119 – £31,092 | Intermediate rate: 21% | £13,119 – £31,092 |
| Higher rate: 41% | £31,093 – £150,000 | Higher rate: 42% | £31,093 – £125,140 |
| Top rate: 46% | Over £150,000 | Top rate: 47% | Over £125,140 |
| 2022/23 | 2023/24 | |
| Savings income – basic rate | 20%* | 20%* |
| Savings income – higher rate | 40% | 40% |
| Savings income – additional rate | 45% | 45% |
| Dividends – basic rate | 8.75% | 8.75% |
| Dividends – higher rate | 33.75% | 33.75% |
| Dividends – additional rate | 39.35% | 39.35% |
*0% starting rate on up to £5,000 of savings income for 2022/23 & 2023/24. Not available if non-savings/non-dividend income exceeds this limit.
Trusts Standard Rate Band £1,000
| Allowances | 2022/23 | 2023/24 | |
| Personal allowance (PA)* | £12,570 | £12,570 | |
| Married couple’s allowance (MCA) ø | Spouse/civil partner born before 6.4.1935 | £9,415 | £10,375 |
| Minimum MCA | £3,640 | £4,010 | |
| Blind person’s allowance | £2,600 | £2,870 | |
| Marriage allowance** | £1,260 | £1,260 | |
| PA income limit | £100,000 | £100,000 | |
| MCA income limit | £31,400 | £34,600 | |
| Dividend allowance | £2,000 | £1,000 | |
| Personal savings allowance | Basic rate tax taxpayers | £1,000 | £1,000 |
| Higher rate taxpayers | £500 | £500 | |
* PA reduces by £1 for every £2 adjusted net income exceeds PA income limit.
ø MCA relief at 10% if at least one spouse/civil partner born before 6.4.1935. Reduces by £1 for every £2 adjusted net income exceeds MCA income limit, but not below minimum.
**One spouse/civil partner can transfer up to 10% of their PA to the other, provided neither is liable to tax above the basic rate.
| From 1.4.2022 | From 1.4.2023 | |
| Standard rate | 20% | 20% |
| Registration level | £85,000 | £85,000 |
| De-registration level | £83,000 | £83,000 |
| Year to 31.3.2023 | Year to 31.3.2024 | |
| All taxable profits | 19% | n/a |
| Small profit rate – taxable profits up to £50,000 | n/a | 19% |
| Main rate – taxable profits over £250,000 | n/a | 25% |
| Marginal relief fraction | n/a | 3/200 |
| Exemptions | 2022/23 | 2023/24 |
| Individuals & LPRs* | £12,300 | £6,000 |
| Trusts | £6,150 | £3,000 |
*Legal personal representatives (LPRs) are entitled to the annual exemption in the tax year of death and the next two tax years.
| Rates | 2022/23 | 2023/24 |
| Individuals’ gains:
• within available basic rate band • on the balance |
10%* 20%* |
10%* 20%* |
| Trustees’ & LPRs’ gains | 20%* | 20%* |
| Business asset disposal relief | • 10% on the first £1m lifetime gains
• 10%/20%* on the balance |
• 10% on the first £1m lifetime gains
• 10%/20%* on the balance |
| Investors’ relief | • 10% on the first £10m lifetime gains
• 10%/20%* on the balance |
• 10% on the first £10m lifetime gains
• 10%/20%* on the balance |
| * 18% & 28% rates apply to carried interest & residential property not covered by principal private residence relief. | ||
| Companies’ gains charged at corporation tax rate. Indexation allowance is frozen for disposals from 1.1.2018. | ||
| Chargeable transfers | 2022/23 | 2023/24 |
| Standard nil-rate band | £325,000 | £325,000 |
| Residence nil-rate band (available only on death, subject to conditions) | £175,000 | £175,000 |
| Tax on excess value of chargeable transfer on death and lifetime transfers made within seven years of death | 40% | 40% |
| Tax on excess value for chargeable transfers on death where 10% or more of net estate left to charity | 36% | 36% |
| Tax on excess value for other chargeable lifetime transfers | 20% | 20% |
| Reduced tax charge on gifts within seven years before death (taper relief) | |||||
| Years before death | 0–3 | 3–4 | 4–5 | 5–6 | 6–7 |
| % of death charge | 100 | 80 | 60 | 40 | 20 |
| Main exemptions | ||
| Gifts to charities | Unlimited | |
| Gifts between UK domiciled spouses | Unlimited | |
| Annual | £3,000 | |
| Small gifts to any one person | £250 | |
|
Gifts on marriage/civil partnership from: |
Parent | £5,000 |
| Party to marriage/civil partnership or grandparent | £2,500 | |
| Other | £1,000 | |
The maximum amount of contributions on which a member can claim tax relief in any tax year is the greater of:
| Tax Year | Amount |
| 2020/21 to 2023/24 | £1,073,100 |
Lifetime Allowance Charge: For tax years up to 2022/23, 55% on excess paid as a lump sum and 25% on excess designated for drawdown, annuity or scheme pension. In 2023/24, the 25% and 55% LTA charges don’t apply and excess lump sums are taxed at the member’s marginal rate of income tax.
| Tax Year | AA Amount | MPAA Amount |
| 2017/18 to 2022/23 | £40,000# | £4,000 |
| 2023/24 | £60,000# | £10,000 |
Annual Allowance Charge: marginal income tax rate on excess, subject to a minimum of 20%.
Carry forward of up to three years unused annual allowance available.
Money Purchase Annual Allowance (MPAA): applies with no carry forward to money purchase pensions once flexible pension income taken.
# Tapered annual allowance: for 2020/21 to 2022/23, tapered by £1 for every £2 of ʻadjusted incomeʼ over £240,000 to a minimum of £4,000 if ʻthreshold incomeʼ is over £200,000.
For 2023/24, tapered by £1 for every £2 of ‘adjusted income’ over
£260,000 to a minimum of £10,000 if ‘threshold income’ is over £200,000.
| Overall Limit | |
| ISA 2022/23* | £20,000 |
| ISA 2023/24* | £20,000 |
| Junior ISA / Child Trust Fund 2022/23 | £9,000 |
| Junior ISA / Child Trust Fund 2023/24 | £9,000 |
*Eligible savers can contribute up to £4,000 of the overall ISA limit to a Lifetime ISA.
The spouse/civil partner of deceased ISA saver has an additional ISA allowance equal to the value of the deceased’s ISA(s) at the date of death.