Income tax — Personal allowances
| Allowances | 2020/21 | 2019/20 |
|---|---|---|
| Personal allowance 1, 2 | £12,500 | £12,500 |
| Married couple’s allowances | ||
| Transferrable allowance 3 | £1,250 | £1,250 |
| Age related allowance 4, 5 | ||
| - maximum amount | £9,075 | £8,915 |
| - minimum amount | £3,510 | £3,450 |
- Irrespective of age or date of birth, this allowance is reduced by £1 for every £2 of income over £100,000, until completely withdrawn, leading to a marginal tax rate of 60% on income in the band from £100,000 to £125,000.
- The personal allowance has been frozen at £12,500 for 2020/21, thereafter, increases will be indexed in line with the Consumer Price Index.
- A spouse or civil partner is entitled to transfer up to 10% of their personal allowance to their spouse or civil partner, provided neither partner is a higher or additional rate taxpayer, and neither was born before 6 April 1935.
- Available to those born before 6 April 1935.
- Tax relief for this allowance is restricted to 10% and the allowance is reduced by £1 for every £2 of income over £30,200 (2019/20 — £29,600) subject to the minimum allowance. The married couple’s allowance is reduced after the personal allowance.