Personal Tax Allowance

The Personal Tax Allowance goes up from £8,105 to £9,440. This is the amount you can earn before you start paying tax. However, the Government has also once again reduced the point at which higher rate tax becomes payable. This kicks in now at £34,370. For those with the standard personal allowance this means they would start paying 40% tax on earnings above £43,810 (personal tax allowance of £9,440 plus the Basic Rate Band of £34,370). In 2013/14 the highest rate of tax – for those earning in excess of £150,000 – has come down from 50% to 45%.