Income from employment
This Includes income from full, part-time and temporary employment, and if you get any benefits from your employer these may also be taxable.
Income from self employment/partnerships
Profits you make from working for yourself as a sole trader or partner. This income will generally need to be recorded with a set of financial statements.
This includes, State Pension, Personal or company pensions and Retirement annuity.
Interest on savings
This includes Bank and building society interest (however, Individual Savings Accounts (ISAs) are exempt), and National Savings and Investments accounts and bonds.
Dividends on company shares (however, dividend income from ISAs is exempt)
The most common taxable state benefits are
- Carer's Allowance,
- Jobseeker's Allowance
- Employment and Support Allowance - 'contribution' based (if you have paid enough National Insurance contributions)
- Incapacity Benefit - from week 29
- Weekly Bereavement Allowance
This can be in the form of a lodger in your only or family home if you receive more than £4,250 a year (£2,125 if split jointly), or from a second property. The taxable profit is after allowable expenses and any mortgage interest.
NON TAXABLE INCOME
The most common non-taxable state benefits are
- Disability Living Allowance
- Attendance Allowance
- Lump sum Bereavement Payments
- Pension Credit
- Free TV licence for over 75s
- Winter Fuel Payments and Christmas Bonus
- Housing Benefit
- Employment and Support Allowance - income based (if you haven't paid enough
- National Insurance contributions)
- Income Support - certain payments
- Child Benefit
- Guardian's Allowance
- Maternity Allowance
- Industrial Injuries Benefit
- Severe Disablement Allowance
- War Widow's Pension
- Young Person's Bridging Allowance
Interest on savings
This includes All ISAs, and Savings Certificates.
The first £4,250 a year from a lodger in your only or family home - £2,125 if split jointly.
This includes both Working Tax Credit, and Child Tax Credit.
Wins from Premium Bonds are free from UK Income Tax and Capital Gains Tax.