Income tax thresholds

[Ruprect]

Just found this on HMRC:

Income Tax allowances 2009-10 2010-11 2011-12
Personal Allowance (1) £6,475 £6,475 £7,475

Income Tax rates and taxable bands Rate 2009-10 2010-11 2011-12
Starting rate for savings: 10%* £0-£2,440 £0-£2,440 £0- £2,560
Basic rate: 20% £0-£37,400 £0-£37,400 £0- £35,000
Higher rate: 40% Over £37,400 £37,401-£150,000 £35,001-£150,000
Additional rate: 50% Not applicable Over £150,000 Over £150,000

HM Revenue & Customs: Income Tax allowances

So, in 11/12, the level at which you're taken into 40% territory is actually coming down by £1400 (despite inflation running at about 4%), in effect increasing the tax take on every higher bracket earner by at least £560 per year. (did I get my sums right?). Oh and don't forget the removal of child benefit too.

WE ARE ALL IN THIS TOGETHER

[SueEllen]

There are many more people on basic rate tax than higher rate tax so raising the tax allowance helps them.

The Lib Dem idea is to raise loads of people out of tax which the Tories are doing stuff to implement. Unfortunately the rest of us have to pay for it................

[DimPrawn]

WE ARE ALL IN THIS TOGETHER

WE ARE ALL IN THE SH1T TOGETHER

thankyou Labour.

[Moscow Mule]

I think you've got your sums wrong.

Free UK Tax Calculator 2010. Updated for 2010/2011 Tax Year and now also 2011/2012 Tax Year.

If your salary is £30k ish, you get ****ed over. If it's more than £40k (ish) you come out better (on Tax/NI).

You have to be earning over £80k for it to hit you by £500.

Which, incidentally, is £10 a week. I spend that on my lunch and coffees every day!

[VectraMan]

The Lib Dem idea is to raise loads of people out of tax which the Tories are doing stuff to implement. Unfortunately the rest of us have to pay for it................

Yes but the rest of us are very quick to moan about all the benefits we have to pay for, and the intent is to make low paid jobs more attractive than benefits. IMHO this is a pretty good policy from the LibDems, and one of the big positives of having a coallition (and the tories dropping their daft promise to cut inheritance tax).

[centurian]

Funny how people are only just noticing that with 8 weeks to go though.

Maybe, just maybe, it will encourage some benefit layabouts to actually go and get a job - now that tax won't cut as much into their minimum wage salary.

Realistically though, it needs to be around 10K to make a difference - the hard part is paying for it.

[SueEllen]

Funny how people are only just noticing that with 8 weeks to go though.

Maybe, just maybe, it will encourage some benefit layabouts to actually go and get a job - now that tax won't cut as much into their minimum wage salary.

Realistically though, it needs to be around 10K to make a difference - the hard part is paying for it.

Lib dems want it to be 11k.
That would mean loads of civil servants out of jobs due to a simplified tax & benefits system for the average person.

[Fred Bloggs]

I suspect that the majority of income splitting contractors will continue to draw just under the 40% tax bracket for themselves and spouse and will not really be affected by this. Don't forget, we save 1% on corporation tax in the coming year.

[amcdonald]

Lib dems want it to be 11k.
That would mean loads of civil servants out of jobs due to a simplified tax & benefits system for the average person.

Sounds good to me, next stop a flat rate tax system

[AtW]

Sounds good to me, next stop a flat rate tax system

Flat rate basically makes economic sense but impossible to bring in politically