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10 | Year-End Tax Guide 2017/18
UPCOMING CHANGES
Future rules, rates and allowances may affect your inancial
planning for 2018/19.
Some changes from April 2018 include:
PERSONAL ALLOWANCE AND THRESHOLD
The personal allowance for 2018/19 is £11,850.
The basic rate band threshold increases to £34,500 in
2018/19, meaning individuals who are entitled to the full
personal allowance will not be liable for higher rate tax
until their total income exceeds £46,350.
The national insurance contributions upper earnings limit
will also rise to remain in line with the higher rate threshold.
Income tax in Scotland is set for more major changes
in 2018/19.
The three-band system will be replaced with ive bands,
with tax rates ranging from 19% to 46%.
Individuals entitled to the full personal allowance in
Scotland will begin paying the higher rate of tax at 41%
when their income exceeds £44,273.
CAPITAL GAINS TAX
The annual allowance increases to £11,700 for individuals
and to £5,850 for most trusts.
ISAs
The overall annual ISA subscription limit remains at
£20,000, while the Junior ISA allowance increases to
£4,260 from 6 April 2018.
PENSIONS
The pension lifetime allowance increases by £30,000 to
£1.03 million.
VEHICLES
From 6 April 2018, the van beneit charge will increase
from £3,230 to £3,350 and the van fuel beneit charge
will increase from £610 to £633.
Employees provided with fuel for private mileage in a
company car will see the value of the multiplier used
for calculating the cash equivalent of the fuel beneit
increase from £22,600 to £23,400.
The diesel supplement used to calculate the company car
beneit and company car fuel beneit will rise from 3% to
4% for all diesel cars registered on or after 1 January 1998
that do not meet real driving emissions step two (RDE2)
standards. Diesel cars which are certiied to RDE2 standard
will not be liable to the diesel supplement.
Changes from 1 January 2018:
R&D
From 1 January 2018, the rate of tax relief available to
companies that carry out qualifying R&D and claim the
research and development expenditure credit (RDEC)
increased from 11% to 12%.
CORPORATION TAX
For a capital gain made by a company on or after
1 January 2018, the indexation allowance, which is applied
in order to determine the amount of the chargeable gain,
will only be calculated up to December 2017.
For disposals made after this date, the indexation will
no longer be calculated up to the month in which the
disposal of the asset occurs.
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