Business Debt Service: Tax Sheet 2021 - 22
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| Personal Allowances | 2020/21 | 2021/22 |
|---|---|---|
| Personal allowance (1) | 12,500 | 12,570 |
| Income Limit For Personal Allowance (2) | 100,000 | 100,000 |
| Income Limit for Married couples allowance (3) | 30,200 | |
| Married couple’s allowance (maximum allowance) (4) | 9,075 | 9,125 |
| Married couple’s allowance (minimum allowance) (5) | 3,510 | 3,530 |
| Blind Person’s Allowance | 2500 | £2,520 |
- (1)(2) Since 2016/17 everyone is entitled to the same personal allowance and income limit, irrespective of age.
- (3) These allowances reduce where the income is above the income limit by £1 for every £2 of income above the £30,200 limit.
- (3) Tax relief for the Married Couple’s Allowance is given at the rate of 10 percent.
| Income Tax Rates and Bands | 2020/21 | 2021/22 |
|---|---|---|
| Basic rate 20% | 0 - 37,500 | 0 - 37,700 |
| Higher rate 40% | 37,501 - 150,000 | 37,701 to £150,000 |
| Additional rate 45% | Over 150,000 | Over 150,000 |
| National Insurance Contributions for Sole Traders | 2020/21 | 2021/22 |
| Class 2 | 3.05 per week | 3.05 per week |
| Class 2 - Small earnings exemption | 6475 per annum | 6515 per annum |
| Class 4 - Lower profits limit | 9501 per annum | 9568 per annum |
| Class 4 - Upper profits limit | 50000 per annum | 50270 per annum |
| Rate between upper and lower profits limit | 9% | 9% |
| Rate above upper profits limit | 2% | 9% |
| Your monthly business income or ‘drawings’ | A | ||
| Multiply by 12 to get the annual figure | B | ||
| Tax allowance (refer to personal allowances) | C | ||
| Taxable amount (B-C) | D | ||
| First £37,701 of D x 20% | E | ||
| D - £37,701 (if answer is greater than 0) x 40% | F | ||
| E + F = estimated tax liability | G | ||
| Divide G by 12 to get monthly amount | H | ||
| The calculated figure in H is your ‘estimated monthly Income tax amount’ |
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Last updated:
22 June, 2021