The 2015 Summer Finance Bill - Personal Tax

  • Personal allowance: increased to £10,600 for 2015/16, £11,000 for 2016/17 and £11,200 for 2017/18.
  • Personal allowance indexation change: once the personal allowance reaches £12,500 it will be increased in line with the national minimum wage (NMW) so that anyone on NMW working 30 hours per week or less does not pay income tax.
  • Tax lock for income tax: rates of income tax will not be able to rise above their 2015/16 levels for the duration of the current Parliament.
  • Higher rate threshold increase: increased to £43,000 for 2016/17 and to £43,600 for 2017/18.
  • Restricting finance cost relief for landlords: relief on finance costs that individual landlords of residential property can claim will be restricted to the basic rate of income tax. The restriction will be phased in over four years, beginning in April 2017.
  • Taxation of pensions at death: the 45% tax rate that applies to lump sums paid from the pension fund of someone who dies aged 75 or over is reduced to the marginal rate of tax of the recipient from 6 April 2016.
  • Pensions: reduced annual allowance for top earners: the benefits of pensions tax relief for those with incomes, including pension contributions, above £150,000 will be restricted from 6 April 2016 by tapering away their annual allowance to a minimum of £10,000.
  • ‘Pension input periods’ for contribution limits: aligned with the tax year from 8 July 2015.
  • Taxation of councillors’ travel expenses: from 6 April 2016 most home-to-office travel expenses paid to councillors by their local authority will be exempt from income tax.
  • Income tax exemption for non-residents participating in the 2015 Anniversary Games: non-residents participating in the 2015 Anniversary Games taking place between 24 and 26 July 2015 will be exempt from income tax.

Related links

Venture capital schemes
Inheritance tax
Business tax
Administration and enforcement
Other taxes

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