NO CHANGES TO INCOME TAX RATES AND PERSONAL ALLOWANCE FROZEN

Gerry MacCrossan

Gerry MacCrossan

NO CHANGES TO INCOME TAX RATES AND PERSONAL ALLOWANCE FROZEN


The basic rate of income tax and higher rate remain at 20% and 40% respectively, and the 45% additional rate continues to apply to income over £150,000. As previously announced in the March Budget, the personal allowance and higher rate threshold have been frozen at £12,570 and £50,270 until 2025/26.

As announced on 7th September – from 6th April 2022, dividend income will be taxed at 8.75%, 33.75% and then 39.35%, depending upon whether the dividends fall into the basic rate band, higher rate band or the additional rate band. The first £2,000 of dividend income continues to be tax-free. The summary of the economic impact published on Budget Day suggests that these rates will remain in place until 2025/26.