Basic Tax Rate

The basic tax rate (BTR) is the rate of Income Tax that you pay when you earn between £12,571 and £50,270 in a year. This rate is accurate as of the 2023/2024 tax year. If you pay basic rate tax, you are obliged to pay 20% income tax in England and Wales. However, you are only accountable for tax for your taxable income – you have a tax-free Personal Allowance of £12,570.

There are multiple rates of income tax depending on your income, but you’ll be charged different rates of tax for each bracket of your income.

Take a look at the current rates of Income Tax:

Income Tax rate
Up to £12,570 0% Personal allowance
£12,571 to £50,270 20% Basic rate
£50,271 to £125,140 40% Higher rate
over £125,141 45% Additional rate

Frequently Asked Questions

  • What is the Personal Allowance?

    The Personal Allowance is a tax-exempt income amount. You are eligible for the Personal Allowance if you earn anything below £100,000, at which point you gradually start to lose your exemption, £1 at a time.

  • How should I be calculating my income tax obligations?

    Different brackets of your income will be taxed at different rates, so contact our accountants for more advice, or take a look at our guide to the tax implications of earning over £100,000 per year to learn more.

Search More Terms

News & Insights

Tax
2 weeks ago

Tax on Crypto Currency and Digital Assets

Tax on Crypto Currency and Digital Assets is a rapidly evolving regulatory landscape. For cryptocurrency and digital ass...
Tax on Crypto Currency and Digital Assets is a rapidly evolving regulatory landscape. For cryptocurrency and digital assets in the UK, companies and individuals need to plan ahead to ensure compliance with their tax obligations. H...
Uncategorized
1 month ago

Freelancer Tax Tips UK

The financial challenges of freelancing are often a burden most people don’t anticipate. Over the years, the prices ch...
The financial challenges of freelancing are often a burden most people don’t anticipate. Over the years, the prices charged are increasing faster than the personal tax rate bands. As a result of this, freelancers who would have ...
Tax
2 months ago

VAT Filing Deadlines 2025 and How to Prepare

What are the VAT filing deadlines UK 2025, how do you prepare for VAT compliance and what is VAT? Value Added Tax (VAT) ...
What are the VAT filing deadlines UK 2025, how do you prepare for VAT compliance and what is VAT? Value Added Tax (VAT) is a tax added to goods and services sold by businesses that are registered for VAT. Businesses in the UK, hav...
Tax
2 months ago

VAT Mistakes and How to Avoid Them

Completing VAT returns can be challenging for small business owners, with substantial legislation and rules complicating...
Completing VAT returns can be challenging for small business owners, with substantial legislation and rules complicating matters further. It can be quite easy to make a mistake if you are not well versed in UK VAT legislation. At ...
Tax
2 months ago

HMRC Voluntary Disclosure Guide

Whether you are self-employed or run your own business, managing taxes can be daunting. Occasionally mistakes can happen...
Whether you are self-employed or run your own business, managing taxes can be daunting. Occasionally mistakes can happen, but fortunately HMRC allow you an opportunity to rectify any mistakes through a voluntary disclosure. This a...
Tax
3 months ago

Financial Consulting Services

Financial consulting services cover a range of advisory activities designed to help companies manage finances effectivel...
Financial consulting services cover a range of advisory activities designed to help companies manage finances effectively. An accountant can provide this, with the expertise and knowledge needed to help you manage finances. The pr...
Tax
3 months ago

Tax on Instagram Earnings: A Guide for Content Creators

UK tax on Instagram earnings is something most creators fail to account for. Instagram has become more than just a place...
UK tax on Instagram earnings is something most creators fail to account for. Instagram has become more than just a place to share videos. It’s an avenue for content creators to monetise their creativity. Whether you’re...
Expert Piece
3 months ago

Budget 2024 Impact on Businesses

The Autumn Budget 2024 will have an impact on businesses in the UK. As announced, taxes are set to rise by £40 billion,...
The Autumn Budget 2024 will have an impact on businesses in the UK. As announced, taxes are set to rise by £40 billion, with a substantial £25 billion coming from increased employers’ national insurance contributions. This...
Load More View All

Subscribe Now

Receive our latest news & insights directly to your fingertips.