Tax Rates

Income tax rates

The table below shows the tax rates you pay in each band if you have a standard Personal Allowance for 2016/17:

Rate Classification Salary Range Tax Rate
PAYE Threshold £0 - £11,000 0%
Basic Rate £11,001 - £43,000 20%
Higher Rate £43,001 - £150,000 40%
Additional Rate over £150,000 45%

National Insurance Rates

National Insurance contributions are paid by employees to build up their entitlement to certain state benefits, including the State Pension. Contributions paid are dependent upon earnings:

Earnings Per Month Percentage Paid Additional Contribution
£672 - £3,583 12%  
over £3,583   2%

Payment of contributions cease when State Pension is reached.

Personal Allowance Rates

This is the amount of income you can receive each year before income tax is calculated.  Until you reach the State pension age the personal allowance thresholds are:

Financial Year Earnings Threshold
2015-16 £10,600
2016-17 £11,000

More information on all of the above rates can be found on the HRMC website