Accounting News, Budget & Updates
The Chancellor's last budget was on 29 October 2018 and the spring statement was on 13 March 2019.
Key Data for the 2019/20 Tax Year
|Higher Rate Band||£37,500|
|Top Rate Band||£150,000|
|Basic Rate Income Tax||20%|
|Higher Rate Income Tax||40%|
|Top Rate Income Tax||45%|
|Dividend Rates||7½% / 32½% / 38.1%|
|National Insurance - Employees||12% over £166 per week|
|National Insurance - Employers||13.8% over £166 per week|
|National Insurance - Self Employed||
£3 per week plus 9% on profits over £8,632,
then 2% over £50,000
|National Insurance - Voluntary||£15 per week|
|Company Tax Rate||19%|
Scottish and Welsh tax rates
Different tax and National Insurance rates and thresholds apply for Scottish and Welsh tax payers.
To summarise the tax rules for foster carers in calculating their profits, all income is included in the calculation, but reimbursed expenses can be disregarded.
A tax allowance (qualifying amount) is compared to the income. This is split into 2 elements:
- A weekly amount, currently £200 for children under 11 and £250 for children aged 11 and over. For any part week, a full week's allowances are given. A week is defined as Monday to Sunday. Plus
- An annual fixed amount of £10,000.
If income is less than the qualifying amount, none is taxable.
If income is more than the qualifying amount, the carer can use one of 2 methods for calculating their taxable profit:
- The simplified method - taxable income is the excess of income over the qualifying amount.
- The profit method - all income less the actual costs of fostering but excluding all personal costs or elements of shared costs. This would entail keeping detailed records of receipts and payments, similar to other businesses.