The 2018/19 tax year is now well underway. Below is a summary of some of the changes to tax allowances, to assist individuals to plan as the tax year progresses.

Income tax

  • The personal allowance has increased from £11,500 to £11,850.
  • The basic rate band has increased from £33,500 to £34,500, giving a higher rate threshold of £46,350.

Capital gains tax

  • The capital gains tax annual exemption has increased from £11,300 to £11,700 for individuals and from £5,650 to £5,850 for most trusts.

Property tax

  • Phasing in since 2017/18 to 2020/21, the deduction for mortgage interest in respect of let properties will continue to be restricted to a basic rate tax reducer. In 2018/19, finance costs on residential properties will be further restricted such that only 50% of finance costs will be an allowable deduction (down from 75% in 2017/18). The remaining 50% will be given as a basic rate tax deduction (up from 25% in 2017/18).

Inheritance tax

  • The inheritance tax nil rate band remains at £325,000.
  • The residence nil rate band has increased to £125,000 for the 2018/19 tax year. This band is tapered at £1 for £2 for estates over £2,000,000.

Marriage allowance

  • The marriage allowance has increased to £1,190, allowing a couple to save an additional £238 in the tax year where a claim has been made.


  • The ISA allowance remains static at £20,000. The limit on a Junior ISAs has increased to £4,260.


  • The lifetime allowance has increased from £1,000,000 to £1,030,000.

If you would like any further information, or to discuss any of the above please don’t hesitate to call us –

Richard White, Rugby on 01788 539000 or Amy Read, Leicester on 0116 261 0061.