Tax rates for 2011/12
The Government has published new tables confirming the rates and thresholds for income tax, national insurance contributions, and tax credits for the 2011/12 tax year. This starts on 6 April 2011.
Normally we have to wait for the Budget to be sure of the full picture. This year however all of the key information has been published. We only await confirmation of the annual allowance for capital gains tax and the turnover limit for VAT registration.
Many of the tax and NIC figures were announced in the June Budget. These have now been confirmed following the publication of the retail prices index (RPI) and consumer prices index (CPI) for September 2010.
Points to notes are:
- The basic rate income tax threshold will be reduced from £37,400 to £35,000
- The personal allowance will increase by £1,000 from £6,475 to £7,475
- The NIC earnings thresholds for employees and employers are diverging; employees will pay NIC above £139 per week, but employers must pay NIC on employees’ wages above £136 per week.
The limit for Individual Savings Accounts (ISAs) for 2011-12 has also been confirmed. This will increase from £10,200 to £10,680.