More Tax Free Allowances in 2017?
Posted on 10th January 2017 at 12:30
Are you receiving self-employed or rental income? How about new tax free allowances in 2017?
There are to be two further tax free allowances starting from the 6th of April 2017. Currently there is a £5,000 tax free dividend allowance and a personal savings allowance which is up to £1,000. The new allowances are a £1,000 rental income allowance and a £1,000 tax free allowance for self-employed income.
This could benefit individuals who are doing small amounts of self-employed work or receiving small amounts of rental income. They will not need to report small income, as a result they may fall outside self-assessment.
It should work as the £1,000 allowances are the gross amounts that will be tax free each year. Any gross income above £1,000 there will be a choice of paying tax on the excess income above £1,000 or deducting allowable expense in the usual way.
Also whilst on this topic there is a further £7,500 a year allowance deducted from rent received from lodgers where an individual is renting out part of their residence. This means the first £7,500 rent from lodgers is tax free. This allowance increased from £4,250 from the 6th of April 2016. Any allowance over £7,500 a year the excess income is taxable.
So are you doing some self-employed work, can you come within the bracket for tax free allowance?
Tagged as: tax
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