2023/24

• Income tax applies to the amount of income after deduction of personal allowances.
• Income is taxed in a specific order with savings and dividend income taxed last.
• Dividend income and savings income falling within the dividend and savings allowances still form part of total income of an individual.
• The starting rate band is only applicable to savings income. The 0% rate is not available if the taxable amount of non-savings income exceeds the starting rate band.
• The Scottish Parliament set the rates of income tax and the limits at which these rates apply for Scottish residents on non-savings and non-dividend income.
• Income tax is devolved to Wales on non-savings and non-dividend income.

Income tax rates

Band of taxable income		Rate	Rate if dividends
£		%	%
0 - 37,700	Basic rate	20	8.75
37,701 - 125,140	Higher rate	40	33.75
Over 125,140	Additional rate	45	39.35
Special rates for savings and dividend income falling into above bands of taxable income
Savings Allowance
Basic rate taxpayers	1,000	0
Higher rate taxpayers	500	0
Additional rate taxpayers	Nil	N/A
Dividend Allowance
for all taxpayers	1,000		0