Income that can be taxed includes money earned from employment, self-employed profits, some state benefits, most pensions, interest on savings, rental income, income from a trust, dividends from company shares and other benefits you get from your job.
In the tax year 2016 to 2017, the standard tax-free Personal Allowance is £11,000. That means you don't pay tax on the first £11,000 you earn. If you fall into the higher rate tax bracket, that is, if you earn over £100,000, your tax-free Personal Allowance may be less than £11,000.
In the tax year 2016 to 2017, if you’re on the standard Personal Allowance, you’ll start paying 20% of tax on income between £0 - £32,000 above your £11,000 Personal Allowance. A 40% rate will apply to income you have over £43,000. And if you’re lucky enough to be a really high earner, you’ll pay the Additional 45% rate on anything over £150,000.
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The Government is about to introduce a new tax incentive for married couples and people in a civil partnership. You'll soon be able to apply online through GOV.UK Verify.
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