What are the UK Tax Rates for 2020?

Even though we are approaching the end of the current Tax Year, we get asked this question a lot. So read on and perhaps save this page, screenshot it, photograph it, commit it to memory or add this Page to your favourites for future reference.

Why you need to know Rates and Bands

When you complete your Personal Tax Return the rates are used to calculate how much Tax you need to pay. In the table below you can see that most people have a tax-free allowance of £12,500 which means they can earn this amount of money before they pay any tax.

If you understand the Rates and Bands you can plan your tax situation and make sure you are putting enough money aside to pay your Tax bill.

Income Tax Rates and Bands

The table shows the tax rates for 2020 that you pay in each band if you have a standard Personal Allowance of £12,500.

Income tax bands are different if you live in Scotland.

Band	Taxable income	Tax rate
Personal Allowance	Up to £12,500	0%
Basic rate	£12,501 to £50,000	20%
Higher rate	£50,001 to £150,000	40%
Additional rate	over £150,000	45%

Other allowances

You have tax-free allowances for:

savings interest
dividends, if you own shares in a company

You may also have tax-free allowances for:

your first £1,000 of income from self-employment – this is your ‘trading allowance’
your first £1,000 of income from property you rent (unless you’re using the Rent a Room Scheme)

Find out whether you’re eligible for the trading and property allowances.

You pay tax on any interest, dividends or income over your allowances.

Please note: This information is taken from the HMRC website where it is updated as necessary. You should refer to the HMRC website for up to date information.

You’ve been reading: