Income Tax rates
The rates of Income Tax you pay depend on how much taxable income
you have above your Personal Allowance.
2014 to 2015 tax year
The current tax year is from 6 April 2014 to 5 April 2015.
| Tax rate | Taxable income above your Personal Allowance |
|---|---|
| Basic rate 20% | £0 to £31,865 |
| Higher rate 40% | £31,866 to £150,000 |
| Additional rate 45% | Over £150,000 |
ExampleYou earn £35,000 of taxable income and your Personal Allowance is £10,000. You pay basic rate tax at 20% on £25,000 (£35,000 minus £10,000).
If you pay higher or additional rates
If your taxable income’s over £31,865 above your Personal Allowance, you pay:
- 20% basic rate tax on the first £31,865
- 40% higher rate tax on taxable income between £31,865 and £150,000
- 45% additional rate tax on taxable income over £150,000
Income Tax on savings interest
Savings interest is automatically taxed at 20%. If you’re on a low income, you may be able to get the interest tax-free or get half of the tax repaid.
Income Tax rates: 2013 to 2014 tax year
The previous tax year was from 6 April 2013 to 5 April 2014.
| Tax rate | Taxable income above your Personal Allowance |
|---|---|
| Basic rate 20% | £0 to £32,010 |
| Higher rate 40% | £32,011 to £150,000 |
| Additional rate 45% | Over £150,000 |
Read more on Gov.uk
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