For general information on the tax system in the UK, visit https://www.gov.uk/browse/tax.
Income tax on earnings, UK pensions, and benefits are taken from your wages, as are taxes to cover National Insurance if you’re employed. If you are self-employed, you (or your accountant) will have to fill in a tax return and you will need to pay National Insurance contributions. For more information see HM Revenue and Customs (http://www.hmrc.gov.uk/selfemployed) on everything you need to know about registering to pay income tax.
The Tax Year in the UK runs from April 6 to April 5 the following year.
Income Tax bands and rates for 2013-2014
|Taxable Income||Rate of Tax|
|0 – £2,790||10% (Starting rate for savings only)|
|0 – £32,010||20% (Basic rate)|
|£32,011 – £150,000||40% (Higher rate)|
|Over £150,000||45% (Additional rate from 6 April 2013)|
You pay income tax on savings and investments, as well as rental income. Inheritance Tax, Corporation Tax and Capital Gains Tax (CGI) are also payable.
When you purchase goods or services in the UK, you are automatically charged Value Added Tax (VAT). Fuel is taxable, as are tobacco and alcohol.
There are also local government taxes. On each house and flat payable by the tenant (when rented) or the landlord (if owned) there is a council tax or poll tax. In addition, there is street-parking tax.
In addition to the taxes you pay, there are also tax-credits, the Working Families’ Tax Credit and the childcare tax credit to help towards the cost of childcare. You will find all the information for both subjects on: http://www.hmrc.gov.uk/taxcredits/
Taxes are an incredibly complex area and whenever in doubt, it is advisable to call the relevant tax office. Employees are very helpful and will do their best to clarify the situation. There is no central number, however, you will find most contact numbers on this webpage: http://www.hmrc.gov.uk/agents/contacting-effective.htm.
Tax offices also run courses free of charge.