Rates and Allowances 2007/2008

Rates and allowances set for various types of tax are set out below.

Rates and Allowances - Income Tax


Income Tax Allowances	2007-08 (£)	2006-07 (£)
Personal allowance for people aged under 65	5,225	5,035
Personal allowance for people aged 65-74	7,550	7,280
Personal allowance for people aged 75 and over	7,690	7,420
Income limit for age-related allowances	20,900	20,100
Married couple's allowance tax reduction - aged 73-74	628.50	606.50
Married couple's allowance - aged 75 or more	636.50	613.50
Minimum married couple's allowance tax reduction	244	235
Blind person's allowance	1,730	1,660

The rate of relief for the continuing married couple's allowance and maintenance relief for people born before 6 April 1935, and for the children's tax credit, is 10%.

Taxable Bands
Taxable Bands Allowances	2007-08 (£)	2006-07 (£)
Starting rate 10%	1 - 2,230	1 - 2,150
Basic rate 22%	2,231 - 34,600	2,151 - 33,300
Higher rate 40%	Over 34,600	over 33,300

Capital Gains Tax for Individuals and Trustees


Annual exempt amount	2007-08 (£)	2006-07 (£)
Individuals etc*	9'200	8,800
Other trustees	4,600	4,400

* Individuals, trustees of settlements for the disabled, and personal representatives of the estate of a deceased person.

Corporation Tax Levels on Profits


Profits - £ per year	2008 (%)	2007 (%)
£0–£300,000	20	19
£300,001–£1,500,000	32.50	32.75
£1,500,001 or more	30	30

Rates and Allowances - Inheritance Tax Threshold


Year	Amount (£)
2007-08	300,000
2006-07	285,000
2005-06	275,000
2004-05	263,000

Rates and Allowances - National Insurance Contributions


£ per week	2007-08	2006-07
Lower earnings limit, primary Class 1	£87	£84
Upper earnings limit, primary Class 1	£670	£645
Primary threshold	£100	£97
Secondary threshold	£100	£97
Employees’ primary Class 1 rate between primary threshold and upper earnings limit	11%	11%
Employees’ primary Class 1 rate above upper earnings limit	1%	1%
Employees’ contracted-out rebate	1.6%	1.6%
Married women’s reduced rate between primary threshold and upper earnings limit	4.85%	4.85%
Married women’s rate above upper earnings limit	1%	1%
Employers’ secondary Class 1 rate above secondary threshold	12.8%	12.8%
Employers’ contracted-out rebate, salary-related schemes	3.7%	3.5%
Employers’ contracted-out rebate, money-purchase schemes	1.4%	1%
Class 2 rate	£2.20	£2.10
Class 2 small earnings exception	£4,635 per year	£4,465 per year
Special Class 2 rate for share fishermen	£2.85	£2.75
Special Class 2 rate for volunteer development workers	£4.35	£4.20
Class 3 rate	£7.80	£7.55
Class 4 lower profits limit	£5,225 per year	£5, 035 per year
Class 4 upper profits limit	£34,840 per year	£33, 540 per year
Class 4 rate between lower profits limit and upper profits limit	8%	8%
Class 4 rate above upper profits limit	1%	1%

Rates and Allowances - Tax Credits/Child Benefit

The rates and thresholds of the tax credits are shown below.

Working Tax Credit - £ per year (unless stated)
Rates and Thresholds	2007-08	2006-07
Basic element	£1,730	£1,665
Couple and lone parent element	£1,700	£1,640
30 hour element	£705	£680
Disabled worker element	£2,310	£2,225
Severe disability element	£980	£945
50+ Return to work payment (16-29 hours)	£1,185	£1,140
50+ Return to work payment (30+ hours)	£1,770	£1,705

Childcare element of the Working Tax Credit - £ per year (unless stated)
Rates and Thresholds	2007-08	2006-07
Maximum eligible cost for one child	£175 per week	£175 per week
Maximum eligible cost for two or more children	£300 per week	£300 per week
Percentage of eligible costs covered	70%	80%
Child Tax Credit Family element	£545	£545
Family element, baby addition	£545	£545
Child element	£1,845	£1,765
Disabled child element	£2,440	£2,350
Severely disabled child element	£980	£945

Income thresholds and withdrawal rates - £ per year (unless stated)
Rates and Thresholds	2007-08	2006-07
First income threshold	£5,220	£5,220
First withdrawal rate (per cent)	37%	37%
Second income threshold	£50,000	£50,000
Second withdrawal rate (per cent)	6.67%	6.67%
First threshold for those entitled to Child Tax Credit only	£14,495	£14,155
Income disregard	£25,00	£25,000

Child Benefit/Guardian Allowance - £ per week
Rates	2007-08	2006-07
Eldest/Only Child	£18.10	£17.45
Other Children	£12.10	£11.70
Eldest/Only Child (Lone Parent Rate)	Abolished	£17.55
Guardian’s Allowance	£12.95	£12.50

Published with the consent of HMSO - Inland Revenue copyright is acknowledged