Introduction Background
4.An individual’s taxable income is charged to tax at the basic rate of tax up to the basic rate limit.
5.The basic rate limit is subject to indexation (an annual increase based upon the percentage increase to the retail prices index). Parliament can over-ride the indexed amounts by a provision in the Finance Act.
6.Autumn statement 2012 announced that the basic rate limit will be set at £32,010 for 2013-14. This supersedes the corresponding amount announced at Budget 2012.
7.The table below sets out the amount of the basic rate limit for 012-13, the indexed amount for 2013-14, and the amount specified by this section for 2013-14.
8.The effect of this section is to override the indexed amount for the basic rate limit. This section is part of a package of measures, together with a further section that sets the personal allowance for 2013-14 for those born after 5 April 1948 by an amount above indexation.