Allowances
1 The individual’s personal allowance is reduced where their income is above £100,000. The allowance is reduced by £1 for every £2 above this limit. Taxpayers receiving a pension will also have the benefit of the Pension Tax Allowance (“PTA”). The PTA is calculated by applying the basic rate of income tax (20%) to the difference between the full State Pension and the Personal Allowance; for individuals with total income above the value of the full State Pension, the PTA will be reduced by £1 for every £3 of income above this limit.
2 The inheritance tax threshold is increased to £500,000 where the estate includes a residence passed to direct descendants and the entire estate is worth less than £2 million.
Income tax bands
Dividend, savings and property income tax bands
3 If non-savings taxable income exceeds the starting rate limit, the starting savings rate will not apply to savings income.
Capital gains tax rates
Corporation tax profits4
4 For businesses with profits between £50,000 and £250,000, tax is charged at the main rate, subject to marginal relief provisions which will provide a gradual increase in the effective corporation tax rate.
Stamp duty land tax
Residential property
Non-residential or mixed use property
5 From 1 April 2025, for purchases by first-time buyers of property worth £500,000 or less, the stamp duty land tax rate for a property valued £0 – 300,000 is 0% and for a property valued £300,001 – £500,000 is 0% on the consideration up to £300,000 and 5% on the remainder.
6 Stamp duty land tax is charged with a surcharge of 5% above the usual stamp duty land tax residential rates from 31 October 2024 on purchases by individuals of additional residential properties (such as second homes and buy-to-let properties), and by non-natural persons (companies, partnerships including companies or collective investment schemes) of dwellings, even if they do not own another dwelling.
7 A 2% surcharge applies on purchases by non-UK residents acquiring dwellings in England and Northern Ireland (when combined with the additional 5% rate (see note 5 above), a 7% surcharge applies on non-UK residents purchasing additional residential properties).
8 The 17% rate applies to certain acquisitions of dwellings worth more than £500,000 by “non-natural persons” (a company, a partnership including a company or a collective investment scheme), though in many cases a relief is available from this flat rate.
This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.
Key contacts
If you have any questions, contact a member of the Tax rates and allowances team for assistance:
