What is a Tax Allowance?
- The personal allowance or tax allowance is the amount of income on which you do not pay any income tax.
- Income tax is payable on taxable income exceeding the tax allowances.
- Personal allowance increases when you are claiming marriage allowance or blind person's allowance.
- It decreases when your taxable income exceeds £100,000.
- Individuals earning more than £125,140 don't receive any personal allowance.
- Unused personal allowance cannot be carried backwards or forwards to a different tax year.