The Personal Tax Computation
An individual’s income from all sources is brought together in a personal tax computation. Here is an example
Income Tax Computation
- Components of income £
- Trading income 45,000
- Property income 5,000
- Total Income 50,000
- Less: deductions (2,000)
- Net income before trading losses 48,000
- Less: trading losses (3,000)
- Net income 45,000
- Less personal allowance 8,105
- Taxable income 36,895
| Income Tax allowances | 2010-11 | 2011-12 | 2012-13 |
|---|---|---|---|
| Personal Allowance (1) | £6,475 | £7,475 | £8,105 |
| Income limit for Personal Allowance | £100,000 | £100,000 | £100,000 |
| Personal Allowance for people aged 65-74 (1)(2) | £9,490 | £9,940 | £10,500 |
| Personal Allowance for people aged 75 and over (1)(2) | £9,640 | £10,090 | £10,660 |
| Married Couple’s Allowance (born before 6th April 1935 and aged 75 and over) (2) (3) | £6,965 | £7,295 | £7,705 |
| Income limit for age-related allowances | £22,900 | £24,000 | £25,400 |
| Minimum amount of Married Couple’s Allowance | £2,670 | £2,800 | £2,960 |
| Blind Person’s Allowance | £1,890 | £1,980 | £2,100 |
| Rate | 2010-11 | 2011-12 | 2012-13 |
|---|---|---|---|
| Starting rate for savings: 10%* | £0-£2,440 | £0-£2,560 | £0-£2,710 |
| Basic rate: 20% | £0-£37,400 | £0-£35,000 | £0-£34,370 |
| Higher rate: 40% | £37,401-£150,000 | £35,001-£150,000 | £34,371-£150,000 |
| Additional rate: 50% | Over £150,000 | Over £150,000 | Over £150,000 |