Tax allowances are allocated each year to all tax payers and are the amounts of money your are allowed to earn before you become liable to pay income tax.
The Inland Revenue take into account your tax allowances when calculating what income tax you are eligable to pay every year.
Tax credits and allowances
Updated Budget Day, March 2011
Any income you earn up to your personal allowance is tax-free. Earnings above these levels are taxed at the rates shown on our Income tax table.
| ALLOWANCES/RELIEFS | 2010/2011 £ | 2011/2012 £ |
|---|---|---|
| Personal allowance – under 65 | 6,475 | 7,475 |
| Personal allowance – aged 65-74 | 9,490 | 9,940 |
| Personal allowance – aged 75+ | 9,640 | 10,090 |
| Income limit for age-related allowances | 22,900 | 24,000 |
| Married couple’s allowance – aged 75+ | 6,965 | 7,295 |
| Minimum amount of married couple’s allowance | 2,670 | 2,800 |
| Blind person’s allowance | 1,890 | 1,980 |