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what is the tax allowance for 2024 to 2025?

what is the tax allowance for 2024 to 2025?

2 min read 09-12-2024
what is the tax allowance for 2024 to 2025?

What are the UK Tax Allowances for 2024-2025?

The UK tax system can be complex, but understanding your personal allowance and other tax allowances is crucial for ensuring you pay the correct amount of tax. This article outlines the key tax allowances for the 2024-2025 tax year (6 April 2024 to 5 April 2025). Please note: This information is for guidance only and does not constitute financial advice. Always consult with a qualified financial advisor for personalized tax advice.

1. Personal Allowance:

This is the amount you can earn each year before you start paying income tax. For the 2024-2025 tax year, the personal allowance is currently expected to remain at £12,570. However, this is subject to government announcements and could change. It's crucial to check the official government sources closer to the start of the tax year for confirmation.

2. Additional Tax Allowances:

Beyond the personal allowance, several other allowances can reduce your taxable income:

  • Marriage Allowance: This allows a non-taxpayer to transfer some of their personal allowance to their higher-earning spouse or civil partner. The amount transferable is dependent on the non-taxpayer's income and is claimed through HMRC. The specific details for 2024-2025 are likely to remain the same as the previous year, but it's advisable to verify with HMRC.

  • Blind Person's Allowance: Individuals registered as blind with HMRC receive a higher personal allowance. The exact figures for 2024-2025 haven't been officially released but are anticipated to remain consistent with previous years' rates. Check the official government website for updates.

  • Dividend Allowance: This allowance applies to dividends received from investments. It reduces the amount of tax payable on dividends. While specific figures for 2024-2025 haven't been announced, it is important to monitor the government's announcements for official updates.

  • Capital Gains Tax Allowance: This allowance applies to profits made from selling assets like shares, property, or collectibles. The amount that can be claimed tax-free under this allowance will likely remain unchanged unless otherwise specified by the government in their budget announcement. Consult HMRC's website for the most up-to-date information.

Important Considerations:

  • Tax Codes: Your tax code on your payslip reflects your personal allowance and other allowances. If your tax code is incorrect, you may be paying too much or too little tax. It's important to check your payslip regularly and contact HMRC if you have any concerns.

  • Changes in Circumstances: Your tax allowance can be affected by changes in your circumstances, such as marriage, divorce, or changes in income. Notify HMRC of any changes promptly to avoid tax problems.

  • Official Sources: Always refer to official government sources like the HMRC website for the most accurate and up-to-date information on tax allowances.

Where to Find More Information:

The official website of Her Majesty's Revenue and Customs (HMRC) is the most reliable source for information on UK tax allowances. Their website offers detailed guidance and resources to help you understand your tax obligations.

This article provides a general overview of tax allowances for 2024-2025. Remember to check the HMRC website for the latest official figures and seek professional advice if you need personalized guidance.

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