Nationwide Insurance coverage: What are NI and revenue tax charges and the way a lot do I pay?

Earnings tax is paid on earnings from employment and income from self-employment in the course of the tax yr, which runs from 6 April to five April the next yr.

It is usually paid on some advantages, exterior and pensions, revenue from renting out property, and returns from financial savings, exterior and investments, exterior above sure limits.

The primary fee is 20% and is paid on annual earnings between £12,571 and £50,270.

The increased fee is 40%, and is paid on earnings between £50,271 and £125,140.

When you earn greater than £100,000, you additionally begin dropping the £12,570 tax-free private allowance.

You lose £1 of your private allowance for each £2 that your revenue goes above £100,000.

Anybody incomes greater than £125,140 a yr now not has any tax-free private allowance.

The further fee of revenue tax of 45% is paid on all earnings above £125,140 a yr.

These charges apply in England, Wales and Northern Eire.

Some revenue tax charges are completely different, exterior in Scotland, the place a brand new 45% band took impact in April 2024. On the identical time the highest fee additionally rose from 47% to 48%.