What is the income tax personal allowance for 2020?
WHAT IS A PERSONAL TAX ALLOWANCE? Much to the disappointment of HMRC, every tax year most UK taxpayers are entitled to a UK personal allowance on their taxable income. To put it simply, most people can…
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WHAT IS A PERSONAL TAX ALLOWANCE?
Much to the disappointment of HMRC, every tax year most UK taxpayers are entitled to a UK personal allowance on their taxable income. To put it simply, most people can receive a certain amount of money before having to pay any income tax. This is what is known as a personal tax allowance.
If you’re struggling to get your head around personal tax allowances, GoSimpleTax is here to explain everything you need to know, simply and easily.
HOW MUCH IS THE STANDARD PERSONAL TAX ALLOWANCE?
The standard personal tax allowance amount is £12,500 for 2019/2020. Any income you earn after that will be taxable. The amount of tax you pay after your personal allowance is dependent on how much you earn during a tax year. For example, If your income is above £100,000, basic personal allowance is reduced by £1 for each £2 you earn over the £100,000 limit, irrespective of age.
Personal Allowance & Tax Thresholds
|Personal Tax Allowance||2018/2019||2019/2020|
|Tax-free personal allowance||£11,850||£12,500|
|Basic Tax Rate (20%)||£1-£34,500 (after allowance)||£1-£37,500 (after allowance)|
|Higher Tax Rate (40%)||Income over £34,500||Income over £37,500|
|Additional Tax Rate (45%)||Income over £150,000||Income over £150,000|
If your tax affairs are a little more complex, for example, if you’re married or in a civil partnership and receive a marriage allowance, or for age-related or income-related reasons, then your personal allowance works a little differently. You could also receive tax-free allowances for:
- your first £1,000 of income from self-employment
- your first £1,000 of income from property you rent
HOW DO I GET MY PERSONAL ALLOWANCE?
Getting your personal allowance is simple. If you file a self-assessment tax return, you will automatically receive your tax-free personal allowance.
Is there an easier way to file?
If you need to file a tax return, GoSimpleTax is here to make things unbelievably simple. Forget about long-winded form-filling and unwelcome phone calls with HMRC. Simply enter the details of your income and expenses and we’ll create your tax return for you and submit it online directly to HMRC.
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