Explanatory note

For the tax year 2013-14 this Order replaces certain amounts specified in the Income Tax Act 2007 (c. 3) with increased amounts. In accordance with the method provided by sections 21 and 57, the increases are calculated by reference to the increase in the retail prices index. Where the retail prices index for the September before the start of the tax year is higher than it was for the previous September, an order must be made replacing those amounts. The retail prices index has increased and this Order sets out the new rate limits and allowances for the tax year 2013-14.

Increases made pursuant to section 21(5) are to the basic rate limit and the starting rate limit for savings. Increases made pursuant to section 57(6) are to the personal allowance for people born after 5 April 1948, married couple’s allowance, blind person’s allowance, the income limit for certain of the personal allowances and the married couple’s allowance (“the adjusted net income limit”) and the minimum amount of the married couple’s allowance (“the minimum amount”).

The basic rate limit and the personal allowance for those aged under 65 in the tax year 2012/13 were last amended by the Finance Act 2012 (c. 14). The other amounts were last increased by the Income Tax (Indexation) Order 2011 (S.I. 2011/2926).

A Tax Information and Impact Note has not been prepared for this instrument as it gives effect to previously announced policy and relates to a predetermined indexation formula.