Income Tax Flashcards
Give examples of allowable deductions
Interest payments in certain qualifying loans
Charitable giving-
Payroll giving is an allowable deduction - make contributions to nominated charity gross.
Gift aid is a basic rate band extender
Certain pension contributions:
Net pay arrangements: allowable deduction- taken off before tax calculation
Relief by claim scheme: allowable deduction, contributions to this paid gross
Relief at source schemes:
Here the contribution is paid net of 20% from after tax been deduction. Because of this the provider reclaims the brt paid, the contribution is then also a brt band extender
What can reduce your personal allowance?
Underpaid tax from previous years
Employee benefits like company car
Adjusted net income over 100,000
What tax code means get no personal allowance
A K tax code
What are the deductable allowances?
Personal allowance - 12,570
Personal savings allowance:
BRTP - 1000
HRTP - 500
ARTP - 0
Dividends Allowance:
For all tax payer £1000 allowance - note like advice thus will use up part of the basic or higher rate band for tax
Transferable personal allowance:
Married couples can transfer 10% of personal allowance - £1260 (rounded up) - note this can only be to a basic rate tax paying spouse. A higher or additional rate tax payer cannot receive this
Known as marriage allowance
What is the starting rate for savings income
5000
What are the dividends rate?
Where dividends exceed the 1k allowance they are taxed at the following rate
BRTP - 8.75%
HRTP - 33.75%
ARTP - 39.35