Press release

Deloitte comments on changes to rates and allowances

11 March 2020

Patricia Mock, tax director at Deloitte, comments on rates and allowances:

“As promised in the 2018 Budget there has been no further increase in the personal allowance and higher rate threshold for 2020/21. These remain at £12,500 and £50,000 respectively. Given that the previous Government’s manifesto commitment was met in 2019/20, a year earlier than expected, this is hardly surprising. However with the CPI increase of 1.7% to September 2019 (the measurement month for annual increases) this does mean an effective tax increase for many.

“A £300 increase in the annual exempt amount for Capital Gains Tax purposes was also announced, taking the 2020/21 allowance to £12,300 for individuals and personal representatives, and £6,150 for trustees.

“As previously announced the NIC threshold, which applies throughout the UK, is increased beyond CPI inflation from £8,632 to £9,500 for employees (as part of the overall ultimate ambition to increase this to £12,500). This means a NIC reduction of £104 per annum in cash terms for those earning £9,500 or more. The employer threshold, however, increases with CPI to £8,788. The self-employed will also benefit from the same increase in the NIC threshold, giving an overall NIC saving of £75.52 (£78.12 – £2.60) when the increase in the Class 2 contributions is taken into account. Together, these changes represent a significant cost for the Treasury of over £2bn a year.”


“In Scotland the rates applying to non-savings and non-dividend income are set by the Scottish parliament and were recently agreed as follows. The personal allowance, and rates and thresholds applying to other income are the same as in the rest of the UK.



Taxable income


First £2,085


Next £10,573


Next £18,272


Next £119,070


Above £150,000  



“Whilst Wales has the power to set devolved taxes, these are the same as the UK for 2020/21.”



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