United Kingdom
Top Income Tax
45%
Marginal rate
Corporate Tax
25%
Standard rate
VAT / Sales Tax
20%
Standard rate
Capital Gains
20%
Standard rate
Overview
The UK offers a well-established financial and legal system with moderate tax rates. London is a global financial center. The non-dom regime is being reformed but still offers benefits for new arrivals. Post-Brexit, the UK has its own trade agreements and immigration rules.
Income Tax Brackets
| Income Range (GBP) | Tax Rate |
|---|---|
| 0 - 12,570 | 0% |
| 12,570 - 50,270 | 20% |
| 50,270 - 125,140 | 40% |
| 125,140+ | 45% |
Personal allowance tapers off above 100k GBP. Scotland has different rates.
Corporate Tax
Standard Rate
25%
Small Business Rate
19%
25% for profits over 250k GBP. 19% for profits under 50k. Marginal relief between.
VAT / Sales Tax
Standard Rate
20%
Reduced Rates
0%, 5%
0% on food, children's clothing, books. 5% on domestic energy.
Capital Gains Tax
Standard Rate
20%
Long-Term Rate
20%
10% basic rate, 20% higher rate. Annual exempt amount 6,000 GBP (2024/25). Residential property +8%.
Social Security Contributions
Employee
8%
Employer
13.8%
Self-Employed
9%
Class 1 NI: 8% employee on earnings 12,570-50,270 GBP, 2% above. Class 4 for self-employed.
Special Tax Regimes
Non-Domiciled (Non-Dom) Status
Being reformed from April 2025. New residence-based regime replacing the remittance basis. 4-year FIG regime for new UK residents.
Eligibility: New arrivals to the UK who have not been UK tax resident in previous 10 years.
Pros & Cons
Pros
- Well-established legal and financial system
- Moderate income tax rates
- Extensive tax treaty network (130+)
- English-speaking
Cons
- Non-dom regime being phased out
- High cost of living in London
- No digital nomad visa
- Post-Brexit complications for EU access
Living Indicators
Cost of Living Index
Above average
Quality of Life Index
Good
Best For
Data Sources
Tax rate data for United Kingdom is compiled from the following authoritative sources:
- OECD Tax Database
- Tax Foundation International Tax Competitiveness Index
- World Bank Business Enabling Environment
- United Kingdom government tax authority publications
- PwC Worldwide Tax Summaries
Last verified: 2024-01
Disclaimer: This content is for informational purposes only and does not constitute tax advice. Tax laws change frequently. Always consult a qualified tax professional before making decisions about your tax residency or obligations.