Personal Tax – changing to your personal circumstances


The personal allowance

The personal allowance is currently £11,850. The personal allowance for 2019/20 will be £12,500.


There is a reduction in the personal allowance for those with ‘adjusted net income’ over £100,000 and the threshold has remained at this figure since its introduction for the 2010/11 tax year. The reduction is £1 for every £2 of income above £100,000. So for 2018/19 there is no personal allowance where adjusted net income exceeds £123,700. For 2019/20 there will be no personal allowance available where adjusted net income exceeds £125,000.

The marriage allowance

The marriage allowance permits certain couples, where neither pays tax at more than the basic rate, to transfer 10% of their personal allowance to their spouse or civil partner.


The marriage allowance reduces the recipient’s tax bill by up to £238 a year in 2018/19. The marriage allowance was first introduced for 2015/16 and there are many couples who are entitled to claim but have not yet done so. It is possible to claim for all years back to 2015/16 where the entitlement conditions are met. A recent change to the law allows backdated claims to be made by personal representatives of a deceased transferor spouse or civil partner.

Tax bands and rates

The basic rate of tax is currently 20%. The band of income taxable at this rate is £34,500 so that the threshold at which the 40% band applies is £46,350 for those who are entitled to the full personal allowance. Additional rate taxpayers pay tax at 45% on their income in excess of £150,000. The tax on income (other than savings and dividend income) is different for taxpayers who are resident in Scotland to taxpayers resident elsewhere in the UK. The  Scottish income tax rates and bands apply to income such as employment income, self-employed trade profits and property income. In the 2018/19 Scottish Budget, the Finance Secretary for Scotland introduced five income tax rates as shown in the table of rates at the end of this summary. The income tax rates range between 19% and 46%. Scottish taxpayers are entitled to the same personal allowance as individuals in the rest of the UK.

Tax bands and rates 2019/20

The government has announced that for 2019/20 the basic rate band will be increased to £37,500 so that the threshold at which the 40% band applies is £50,000 for those who are entitled to the full personal allowance. The additional rate of tax of 45% remains payable on taxable income above £150,000.

From April 2019, the Welsh Government has the right to vary the rates of income tax payable by Welsh taxpayers. The UK government will reduce each of the three rates of income tax paid  by Welsh taxpayers by 10 pence. The Welsh Government has provisionally set the Welsh rate of income tax at 10 pence which will be added to the reduced UK rates. This means the rates of income tax paid by Welsh taxpayers will continue to be the same as those paid by English and Northern Irish taxpayers. The Welsh Government will need to confirm this proposal prior to their final Budget. The Scottish Government will announce the Scottish income tax rates and bands for 2019/20 in the Draft Budget on 12 December 2018.

Tax on dividends

In 2018/19 the first £2,000 of dividends are chargeable to tax at 0% (the Dividend Allowance). The Dividend Allowance will remain at £2,000 for 2019/20. Dividends received above the allowance are taxed at the following rates:

  • 7.5% for basic rate taxpayers
  • 32.5% for higher rate taxpayers
  • 38.1% for additional rate taxpayers.

Dividends within the allowance still count towards an individual’s basic or higher rate band and so may affect the rate of tax paid on dividends above the Dividend Allowance.

To determine which tax band dividends fall into, dividends are treated as the last type of income to be taxed.


In 2017/18 the Dividend Allowance was £5,000. The reduction in the allowance particularly affects family company director-shareholders who extract monies from the company by means of a small salary and the balance in dividends. The cost of the restriction in the allowance for basic rate taxpayers is £225 increasing to £975 for higher rate taxpayers and £1,143 for additional rate taxpayers.

Tax on savings income

Savings income is income such as bank and building society interest. The Savings Allowance, which was first introduced for the 2016/17 tax year, applies to savings income and the available allowance in a tax year depends on the individual’s marginal rate of income tax. Broadly, individuals taxed at up to the basic rate of tax have an allowance of £1,000. For higher rate taxpayers the allowance is £500. No allowance is due to additional rate taxpayers.

Some individuals qualify for a 0% starting rate of tax on savings income up to £5,000. However, the rate is not available if taxable non-savings income (broadly earnings, pensions, trading profits and property income less allocated allowances and reliefs) exceeds £5,000.

Rent-a-room relief

Rent-a-room relief gives relief from income tax for up to £7,500 of income to individuals who let furnished accommodation in their only or main residence. Following consultation on the draft legislation and to maintain the simplicity of the system, the government will not include legislation for the shared occupancy test. The government will retain the existing qualifying test of letting in a main or only residence.


Rent-a-room relief was introduced 26 years ago to encourage individuals to make spare capacity in their homes available for rent rather than letting out their entire property. The emergence and growth of online platforms have made it easier than ever for those with accommodation to access a global network of potential occupants. The government wants rent-a-room relief to be better targeted to achieve its objective of incentivising individuals to share their homes.

Gift Aid – donor benefits

Draft legislation has been issued which simplifies the donor benefits rules that apply to charities who claim Gift Aid tax relief on donations. From 6 April 2019 the benefit threshold for the first £100 of the donation will remain at 25% of that amount. For gifts exceeding £100, charities can offer benefits up to the sum of £25 and 5% of the amount of the donation that exceeds £100. The total value of the benefit that a donor can receive remains at £2,500.


The new limits replace the current mix of monetary and percentage thresholds that charities have to consider when determining the value of benefit they can give to their donors without losing the entitlement to claim Gift Aid tax relief on the donations given to them.

Gift Aid Small Donations Scheme

The Gift Aid Small Donations Scheme (GASDS) applies to small charitable donations where it is impractical to obtain a Gift Aid declaration. GASDS currently applies to donations of £20 or less made by individuals in cash or contactless payment. The limit will be raised to £30 from 6 April 2019.

National Living Wage (NLW) and National Minimum Wage (NMW)

Following the recommendations of the independent Low Pay Commission (LPC), the government will increase the NLW by 4.9% from £7.83 to £8.21 from April 2019. The government will also accept all of the LPC’s recommendations for the other NMW rates to apply from April 2019, including increasing the rates for:

  • 21 to 24 year olds by 4.3% from £7.38 to £7.70 per hour
  • 18 to 20 year olds by 4.2% from £5.90 to £6.15 per hour
  • 16 to 17 year olds by 3.6% from £4.20 to £4.35 per hour
  • apprentices by 5.4% from £3.70 to £3.90 per hour.

Universal Credit

The government has announced that the amount that households with children and people with disabilities can earn before their Universal Credit award begins to be withdrawn – the Work Allowance – will be increased by £1,000 from April 2019.

In addition the government has listened to representations made by stakeholders on Universal Credit, and has announced a package of extra support for claimants as they make the transition to Universal Credit.


The government remains committed to the introduction of Universal Credit. The set of measures announced in the Budget are worth £1.7 billion per year.


Need help with your personal tax then call a member of our team on 01522 815100

Accountancy firm celebrates apprenticeships


Getting started on the careers ladder is no easy task, whether you are starting out, returning to work or developing your work skills to further your career. An apprenticeship scheme provides an ideal platform and gives students the chance to start earning a salary whilst training.

Nicholsons Chartered Accountants has embraced and recognises the importance of these schemes and has seen it as a good opportunity to showcase its students. Those who have completed the programmes have successfully qualified as accountants or progressed by gaining their qualifications in Business Administration. The firm has demonstrated that there are opportunities for all to become more advanced members of the Nicholsons team.

With regular informal reviews with a mentor and working closely with a senior member of the team keeps training on track and tackles any issues that may arise.

Richard Hallsworth says “We are delighted with our apprentices and how hard they have worked to achieve their goals. Supporting people on these schemes helps us to fill our recruitment gap as we see training is a key area for us, not only for apprentices but across the board.”

Although Nicholsons works with a small number of training providers, more placements have been taken up through Lincoln College. With the success of Aimee Harrison winning “Apprentice of the Year” and Lucy Christopher as runner up in the Lincolnshire Media Business Awards 2017, and with Imogen Flower being nominated for the 2018 Apprentice of the Year award, the firm believes that it has something to celebrate.

Nicola Hall, Donna Moorhouse and Stephen Watts from Lincoln College joined the team at Nicholsons for coffee and cake to help celebrate the success the team have achieved.

Lincoln College says “We are really proud to be working with the team at Nicholsons. They are a shining example of how Apprentices’ can offer energy and new ideas to a company.  This was demonstrated across the business when we joined them for their celebration. We look forward to our continuing relationsahip”.

Billy Toulson is now studying to be a certified accountant, Aimee Harrison is continuing with her studies to become a chartered accountant and Lucy has joined the secretary’s team after successfully finishing her Business Administration Level 3 and is an asset to the team.

Imogen Flower has also finished her Business Administration qualification and is now studying for her financial services qualifications.

The firm’s newest apprentices, Ieuan Thomas-Cousin, is studying for his AAT qualification and Josh Lester is studying for his Business Administration.

Accountancy firm welcomes Agnieszka Przywala

Nicholsons Chartered Accountants is delighted that Agnieszka Przywala has joined the team based at the firm’s Lincoln office. Aggie’s role within the team is as a Bookkeeper and Management Accountant.

After attending university in Poland, Aggie graduated with a degree in Political Science and Journalism. She came to England and started to work for a local accountancy firm; she found the work interesting and decided to continue with her studies within this sector.

In 2014 Aggie started a BH (Hons) Accountancy and Finance Degree at the University of Lincoln and graduated with a first degree in May 2018. Aggie has also attended a programme at the University of Vallodolid in Spain.

Before joining Nicholsons’ she worked in a small accountancy practice as an Accounts Assistant and as an Accounts Administrator in an accounts department in the construction industry.

Aggie’s home town is Katowice in Poland where she regularly visits her family. Her biggest desire is to travel the world to understand the different cultures. In her spare time, she enjoys reading and cycling.

Emma celebrates 19 years at Nicholsons

Emma Murray joined Nicholsons in 1999 and now celebrates 19 years at the firm. Emma is based at the firm’s Lincoln office, but is available to see her clients at the Market Rasen office.

Emma qualified as a Chartered Accountant in 2002, before becoming a partner in 2007 and a director upon incorporation in 2016. 

Emma’s portfolio of clients is refreshingly diverse ranging from small sole traders to owner managed family businesses and larger corporate organisations both in the private and public sector.

She is one of the leading directors in the audit and charitable services and has several high-profile charity clients. Emma has also become a specialist working within the education sector. She has a strong academic and professional background, coupled with a strong acumen which enables her to provide good sound practical advice.

Away from the office Emma enjoys spending time with her family and friends, she enjoys travelling in the UK and abroad and enjoys the great outdoor life. Last year Emma took part in her first ever Triathlon and this year run the Lincoln 10k in aid of collecting food for the Lincoln Food Bank.

If you would like to speak to Emma about your business, please give her a call on 01522 815100.


Nicholsons Charity Ball raises money for local charities

A charity ball held at the DoubleTree by Hilton on Friday 14th September raised £7,000 for the Lincs & Notts Air Ambulance and LIVES. The new ballroom proved to be an excellent venue for the 250 people who attended the event.

Support from local businesses, who kindly donated prizes for both the raffle and auction, helped Nicholsons Chartered Accountants to raise so much money which will be split equally between the charities.

The evening commenced with a drink’s reception followed by dinner and a raffle. Before the dancing started, Ambrose Fowler from JHWalter took charge of the live auction which raised £2,000. After the auction “The Business” took centre stage, playing a selection of music from classic pop to rock, from the 1960’s to the present day, keeping guests on the dance floor until after midnight.

Both LIVES and the Lincs & Notts Air Ambulance provide vital emergency clinical care, where every minute counts. LIVES has over 700 volunteers who give up their time to respond to 999 medical emergencies on the ground, whilst the Air Ambulance ensures a team of doctors and the equivalent of an A&E department reach the most serious of illnesses and devasting injuries as quickly as possible, giving the patient the best chance of survival. Both of these services are purely funded by the public.

Richard Hallsworth, a director at Nicholsons said “We would like to thank everyone involved in helping us raise so much money. It is an important part for both our business and our staff to help and support local charities which provide such vital services to our community. The evening was a great success, not just from the money raised, but also from the feedback we have received from our guests.”

The Lincs & Notts Air Ambulance has been the firm’s charity for 2017/18. The 2018/19 charity will be St Barnabas Hospice, as voted for by the staff.



Imogen Flower nomination for Apprentice of the Year award

Imogen Flower joined Nicholsons in September 2016 on the apprenticeship scheme run by Lincoln college under the guidance of Steve Watts. She Initially started working alongside Becky Haigh on reception whilst working towards her Level 2 Business Administration Qualification. Imogen’s role involved answering the phone, greeting clients and general administration tasks. She also worked in the main office supporting the secretarial team. She became a valuable member of the team and helped to reduce the workload, as well as enhancing her knowledge of the business.

Imogen had clearly demonstrated an aptitude and desire to progress and once she completed her Level 2 Business Administration Qualification in October 2017, Imogen was given the opportunity to advance and to continue with her studies through another apprenticeship scheme by joining the Financial Services Department.

After reading through the Babington Group Qualification she wanted to get involved and enrolled onto the Level 3 Financial Services Administrator Qualification through the Chartered Insurance Institute (CII). Her studies include learning about the financial services, marketing, regulatory and compliance, financial services products and communication & relationships. Her role within the Financial Service Department includes; writing letters to clients and providers, creating Illustrations and completing contribution applications, preparing up to date valuations for clients, preparing files prior to meetings and making calls to providers for client information.

Imogen works closely with Gail Paton, Head of Financial Services and more so independently since the team has been a member down. This has meant that she has become a valuable member of the team and it has given her the opportunity to show how she can excel and use her learning to provide the relevant support to Gail Paton. Her commitment and dedication will help her develop her role and achieve her goal by passing her exams.

Imogen’s assessor, Bernadine McCrory. comes in monthly to work through her CF1 FS Regulation and Ethics Chapters. Imogen has to read through 2 chapters a month and 20% of her working time should be ‘Off the Job Training’ she also has to complete online tests to track her learning.

Alex Cass – nomination for “Employee of the Year” award

Alex Cass joined Nicholsons Chartered Accountants on the 12th October 2015 through the apprenticeship scheme run by Lincoln College under the direction of Nigel Hullet.  

He started his career in the construction industry but soon realised that he didn’t enjoy the work. Alex wanted to go back to the subjects he enjoyed the most at school, these being maths and business studies.  After taking a step back and doing some essential research, Alex saw his future in accountancy and has excelled in this area ever since.

Under the apprenticeship scheme Alex worked for all the Directors at Nicholsons in general practice under the guidance of Rebecca Betts.  He completed his AAT Level 2 exams within the first year. 

Wanting to move onto the next step as soon as possible Alex found himself frustrated with the slow progress the scheme offered.  He wanted to move up to the next level as quickly as possible, so his only option was to leave the scheme and take the fast track route to complete his ACA certificate level. Jo Brown, head of training at Nicholsons, intervened and contacted the training body, the decision to push on with this was unanimous by the Board as they could all see his potential and didn’t want him to be held back in any way. Alex completed his exams within a year.

Showing such dedication to the business and commitment to his study’s, Alex was promoted from Junior to Semi Senior Accountant in September 2017.  Alex moved from general practice to work in Audit.   From here he also started studying for his professional level ACA qualification and has to date sat and passed the first exam, he still has another eight exams to take.  His aim is to have achieved this by July 2020.  

Alex has a small number of his own clients, but his main role is to support his manager Rebecca Betts in providing efficient audit services to a variety of clients. With his continued study’s he is well placed to offer help and give the right advice to Nicholsons clients. Alex works with a varied portfolio, covering the one-man band, through to multi-million-pound companies and charities.

Alex has grown into his role and has shown great commitment to both his studies and his work. He is very highly thought of by his colleagues and has a great future ahead of him the world of accountancy and audit.



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