What's new for PAYE codes?
Rebecca Cave provides a round-up of points to watch out for in 2015/16.
The PAYE coding notices for 2015/16 have already been issued for most people taxed under PAYE, so what should you watch out for this year?
The standard personal allowance for anyone born on or after 5 April 1938 is £10,600, which gives a basic code for 2015/16 of 1060L.
Pensioners aged 77 or over on 6 April 2015 with modest incomes may have a basic code of 1066L. However, the extra £60 of age allowance is tapered away if the taxpayer has income of over £27,700.
Where the taxpayer's total income exceeds £100,000, the standard personal allowance is also withdrawn at the rate of £1 for every £2 over that threshold. Thus taxpayers whose income is likely to be £121,200 or more should have no personal allowance included in their 2015/16 PAYE code.
Married couple's allowance
Older married couples and civil partners, where one or other individual is aged 80 or over are still eligible to receive the married couple's allowance. This is worth up to £835.50 (10% x £8,355), but that maximum is tapered down for income over £27,700 at £1 for every £2 of adjusted net income over that threshold, but only until the allowance is reduced to £3,220.
This is an extract from an article in the April 2015 edition of TAXline, the magazine of the Tax Faculty.
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