Introduction Section 3: Upper Earnings Limit
13. Section 3 links the UEL to the higher rate income tax threshold by setting out that it shall not exceed the weekly equivalent of the proposed higher rate threshold for that tax year. The "proposed higher rate threshold" is defined in subsection (3) as the sum of the basic rate limit for income tax for the tax year and the personal allowance for income tax for the tax year in the pre-budget proposals.
14. "Pre-budget proposals" is defined as meaning the government's fiscal proposals for a tax year, which are contained in a command paper laid before Parliament by the Chancellor of the Exchequer. It is intended that this will be the Chancellor's autumn statement.
15. As the UEL is a weekly figure the higher rate threshold for income tax has to be converted into a weekly amount, this is done by dividing the threshold by 52 and rounding up or down to the nearest pound.