2018 rates and allowances

Published: 07 Mar 2018

 

Written by Ray Coman

 

Basic State Pension

 

  2017-18

 

2016-17

 

 

Weekly        

Annual             Weekly    Annual         
State Pension £159.55 £8296.60
£155.65

£8,093.80

 

Capital Gains Tax

  2017-18 2016-17
Standard rate (Basic Rate Taxpayers) 10%/18% 10%/18%
Higher rate 20%/28% 20%/28%
Entrepreneurs' relief - effective rate 10% 10%
Entrepreneurs' relief £10 million £10 million

 

Annual exemption

 

   

Individual

£11,300 £11,100
Settlement(s) (spread over total number) £5,650  £5,550

 

Chattels exemption

 

   
(proceeds per item or set)  £6,000  £6,000
Marginal relief  5/3 Excess over £6,000  5/3 Excess over £6,000

 

Individual Savings Account 

Individual savings accounts (ISAs)          2017-18 2016-17
Overall investment limit £20,000 £15,240
Junior ISA  £4,128 £4,080

 

Research and Development Tax Relief

  2017-18  2016-17 Note
SME Enhanced Deduction Scheme 130% 130% A
SME cash credit for R&D loss surrendered 14.5% 14.5%  
Large company above the line scheme credit 11% 11% B

A: Additional (enhanced) tax deduction available for qualifying R&D expenditure

B: Taxable credit available on qualifying R&D expenditure

 

National Insurance Contributions on Employment

Thresholds for Class 1 National Insurance Contributions (NICs)

 

  2017-18 2016-17
Weekly Lower Earnings Limit (LEL)  £113 £112
Weekly Primary Threshold (PT)  £157 £155
Weekly Secondary Threshold (ST)  £157 £156
Upper Earnings Limit (UEE) £866  £827
Upper Secondary Threshold for under 21s £866  £827
Employment Allowance (per employer) £3,000 per year £3,000 per year

 

Class 1 NIC rate on earnings

 

  2017-18 2016-17
  Employee Employer Employee Employer
Between primary threshold and upper earnings limit 12% 13.8% 12% 13.8%
Above upper earnings limit 2% 13.8% 2% 13.8%

  

Class 1(A) NICs

  2017-18 2016-17
Rate 13.8% 13.8%

 

National insurance on Self-employment

 

Class 2 NICs

  2017-18 2016-17
  Weekly Yearly Weekly Yearly
Flat rate £2.85 £148.20 £2.80 £145.60
Small earnings exception limit   £5,965   £5,965

Class 2 national insurance is payable by sole traders and partners in a partnership. If profits are below the small profits limit then it is possible to be excepted from liability to Class 2 NICs. The accrual of social security will be affected if no class 2 liability is paid for a particular year.

 

 Class 4 NICs

  2017-18 2016-17
  Profit band Rate Profit band Rate
Between lower profits and upper profits limit £8,164 to £45,000 9% £8,060 to £43,000 9%
Above upper profits limit   2%   2%

 

Self-employed individuals are liable to class 4 national insurance contributions in addition to class 2 NICs and income tax. Class 4 national insurance contributions will not count towards state benefits, until Class 2 NICs are abolished.

 

Class 3 NICs

  2017-18 2016-17
  Weekly Yearly Weekly Yearly
Flat rate £14.25 £741.00 £14.10 £733.20

 

A person can top up national insurance by making voluntary contributions.  This would be suitable for a non-resident who does not have sufficient qualifying years towards a state pension.

 

Income Tax

Rate

2017-18

2016-17

Basic rate: 20%

£0 to £33,500

£0 to £32,000

Higher rate: 40%

£33,500-£150,000

£32,001-£150,000

Additional rate: 45%

Over £150,000

Over £150,000

 

Rates of income tax on dividends

Rate

2017-18

2016-17

Dividend Allowance £5,000 £5,000
Basic rate 7.5% 7.5% 

Upper rate

32.5%

32.5%

Additional Rate 38.1% 38.1%

 

Rates of income tax on savings

Rate

2017-18

2016-17

Starting rate 0% 0%
Basic rate 20% 20% 

Higher rate

40%

40%

Additional rate 45% 45%
Starting rate limit (savings income) £5,000 £5,000

 

Personal allowances

Allowance

2017-18

2016-17

Basic

£11,500

£11,000

People born between 6 April 1938 - 5 April 1948

£11,500

£11,000

People born before 6 April 1938

£11,500

£11,000

Married Couple's Allowance (if born before 6th April 1935)

£8,445

£8,355

Blind Person's Allowance

£2,320

£2,290

Marriage allowance £1,150

£1,100

The Age Related Income Limit for 2017-18 was £28,000 

 

 

Pension Rates

 

 

2017-18 2016-17

Lifetime Allowance

£1,000,000 £1,000,000

Annual Allowance

£40,000 £40,000

 

 

Car Benefit Charge 

  2017-18
Co2 Emissions g/km Petrol Engine % Diesel Engines %
0-50 9 12
51-75 13 16
76-94 17 20
95-99 18 21
100-104 19 22
105-109 20 23
110-114 21 24
115-119 22 25
120-124 23 26
125-129 24 27
130-134 25 28
135-139 26 29
140-144 27 30
145-149 28 31
150-154 29 32
155-159 30 33
160-164 31 34
165-169

32

35
170-174 33 36
175-179 34 37
180-184 35  
185-189 36
190 and above 37

 

Fuel benefit and van benefit charge

  2017-18 2016-17
Car fuel benefit charge multiplier £22,600 £22,200
Van fuel benefit charge £610 £598
Van benefit charge £3,230 £3,170

 

 

 

Capital Allowances

 

 

Rate of the annual investment allowance

 

 

 

2017-18 2016-17
Annual investment allowance 100% 100%
Main rate on general pool 18% 18%
Special rate pool 8% 8%

  

Annual investment allowance limit

 

 

 

From 1st January 2016 1st April 2014 -
31st December 2015
Annual investment allowance £200,000 £500,000

 

Capital allowances for cars

 

 

2017-18 2016-17
CO2 emissions below 75 g/km 100% 100%
CO2 emissions between 75 g/km and 130 g/km 18% 18%
CO2 emissions over 130 g/km 8% 8%

 The main pool rate applies to a car with CO2 emissions below 130 g/km, and the special rate applies to car with a higher CO2 emissions. Up to 31 March 2018, cars with low emissions, such as those which are electrically propelled, qualify for 100% capital allowance.

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