Budget 2015- Personal allowance increase

08 July 2015

Personal allowances and thresholds will increase as follows:

Personal Allowances

2015-16- £10,600

2016-17- £11,000

2017-18- £11,200

Basic (20%) Rate Limit

2015-16- £31,785

2016-17- £32,000 

2017-18- £32,400

Higher (40%) Rate Threshold

2015-16- £42,385

2016-17- £43,000 

2017-18- £43,600

MHA MacIntyre Hudson comment

The Chancellor is continuing the agenda pursued by the coalition government by increasing the personal allowance. This is a costly measure as it affects all taxpayers (apart from certain individuals such as those earning over £100,000 per year or UK resident non-domiciled taxpayers claiming the remittance basis of taxation). The number of taxpayers paying tax at the 40% rate increased by 46% between 2010 and 2014* so the increase in the higher rate threshold, while welcome, is not particularly significant. The Conservatives’ election pledge to increase the higher rate threshold to £50,000 by 2020 will require large increases in the threshold in the last two years of this parliament if it is to be achieved. 

If you would like some more information about personal allowance increase, please send us an enquiry.