Income Tax Brackets
Taxes are calculated depending on your total income from all sources and collected by HMRC and you will fall into one of many UK tax brackets based upon your earnings.
The new 50% tax bracket remains after the latest budget and personal allowances have also changed which will mean new tax codes and perhaps changes in the amount of tax you pay based on your overall income earned during the year.
Working out your personal tax bracket
To calcuate your overall tax liability first you need to add all your income and earnings together for the past 12 months when the tax year finishes on 6th April of any year. You then get various tax allowances, reliefs and credits which when deducted provides you with the amount in which to calculate your tax liability. The rate of tax is charged in bands or tax brackets and these are shown as follows :
Tax Brackets 2010-2011
For the year 2010-2011 (ending April 5th) the following brackets are used by HMRC to calculate taxes due:
- Starting rate for savings only 10% - £0 - £2,440 (*)
- Basic tax rate 20% - £0 - £37,400
- Higher Rate 40% - up to £150,000
- Additional Rate 50% - over £150,000
Tax Brackets 2011-2012
For the year 2011-2012 (ending April 5th) the following brackets are used by HMRC to calculate taxes due:
- Starting rate for savings only 10% - £0 - £2,560 (*)
- Basic tax rate 20% - £0 - £35,000
- Higher Rate 40% - up to £150,000
- Additional Rate 50% - over £150,000
(*) The 10% starting rate is for savings income only. If your non-savings income is above this limit then the 10% starting rate for savings does not apply
History of Tax Brackets
If you want to see how these have changed over the past few years then check out the information below !
| Tax Year | Band 1 | Band 2 | Band 3 | Band 4 |
| 2011/12 | 10% to £2,560 (*) | 20% to £35,000 | 40% to £150,000 | 50% over £150,000 |
| 2010/11 | 10% to £2,440 (*) | 20% to £37,400 | 40% to £150,000 | 50% over £150,000 |
| 2009/10 | 10% to £2,440 (*) | 20% to £37,400 | 40% to £150,000 | 50% over £150,000 |
| 2008/09 | 10% to £2,320 | 22% to £34,800 | 40% over £34,800 | na |
| 2007/08 | 10% to £2,230 | 22% to £34,600 | 40% over £34,600 | na |
| 2006/07 | 10% to £2,150 | 22% to £33,300 | 40% over £33,300 | na |
| 2005/06 | 10% to £2,090 | 22% to £32,400 | 40% over £32,400 | na |
| 2004/05 | 10% to £2,020 | 22% to £31,400 | 40% over £31,400 | na |
| 2003/04 | 10% to £1,960 | 22% to £30,500 | 40% over £30,500 | na |
| 2002/03 | 10% to £1,920 | 22% to £29,900 | 40% over £29,900 | na |
| 2001/02 | 10% to £1,880 | 22% to £29,400 | 40% over £29,400 | na |
| 2000/01 | 10% to £1,520 | 22% to £28,400 | 40% over £28,400 | na |
| 1999/00 | 10% to £1,500 | 23% to £28,000 | 40% over £28,000 | na |
| 1998/99 | 20% to £4,300 | 23% to £27,100 | 40% over £27,100 | na |
| 1997/98 | 20% to £4,100 | 23% to £26,100 | 40% over £26,100 | na |
| 1996/97 | 20% to £3,900 | 24% to £25,500 | 40% over £25,500 | na |
| 1995/96 | 20% to £3,200 | 25% to £24,300 | 40% over £24,300 | na |
| 1994/95 | 20% to £3,000 | 25% to £23,700 | 40% over £23,700 | na |
(*) for savings income only - not other earnings.