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Kensington tax breaches £50,000 a year


BIG PAGE, non-dom's housing story. expensive properties in and around the Boltons in Kensington, West-London. BIG PAGE, non-dom's housing story. expensive properties in and around the Boltons in Kensington, West-London. House reflected in a puddle, Brompton road. The Boltons.

Income tax paid by means of residents of the uk’s wealthiest constituency hit a file high in 2013-14, the 12 months the top charge fell from 50 to 45 per cent.

Taxpayers in Kensington had moderate liabilities of £52,500 on their annual earnings — almost 10 Occasions the national average — consistent with figures revealed in March through HM Revenue & Customs.

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The tax take from residents of the west London constituency, which contains Notting Hill and Holland Park, rose by using virtually one-fifth year-on-yr, reflecting a broader £8bn rise in revenues from individuals who earned more than £One Hundred Fifty,000 that yr.

James Browne, senior analysis economist on the Institute for Fiscal Research, stated many excessive earners deferred taking dividends and bonuses after the chancellor announced the “additional” tax rate would drop from April 2013.

Regardless Of the minimize in the top charge, the Income tax regime has grow to be Extra revolutionary in its results on the grounds that 2010, he mentioned. “A Lot More of the Income tax burden has fallen on the Perfect earners.”

Successive will increase to the tax-free private allowance, which has swollen from £6,475 to £Eleven,000 considering the fact that 2011, have accumulated the largest benefits, in relative terms, to lower-paid staff, consistent with Mr Browne.

Although higher earners up to £100,000 — above which the non-public allowance is taken away — have also enjoyed the whole worth of this raise, it has been offset by way of the relative fall within the point at which the 40p Earnings tax rate becomes payable.

This threshold has barely increased due to the fact that 2010, propelling 1.6m Extra taxpayers into the upper rate band by 2015-Sixteen.

The concentration of high earners in significant London boroughs way the uk’s eight Perfect-taxed constituencies lie in the capital, the place Earnings tax liabilities averaged £9,760 in 2013-14.

Easiest Income tax paid via constituency, UK, 2013-14
Constituency Imply Earnings tax* Complete Profits tax
Kensington £52,500 £2,750m
Cities of London & Westminster £Forty One,800 £2,590m
Chelsea & Fulham £37,900 £1,940m
Westminster North £26,600 £1,260m
Hampstead & Kilburn £24,900 £1,630m
 *Per taxpayer. Source: HM Revenue & Customs

Residents of the commuter-belt counties of Surrey and Buckinghamshire contributed More Profits tax to the exchequer per taxpayer, alternatively, with payments averaging £10,800 and £10,000 respectively in 2013-14.

Surrey is dwelling to probably the most heavily taxed constituency outside London, Esher and Walton, where average annual incomes are more than £60,000.

Two of the other six constituencies the place salary breach £50,000 a yr are also in Surrey, with the remainder all encompassing commuter towns around the west and south of the M25.

Blended, residents of the highest 10 constituencies — out of 650 — paid £15.5bn in Income tax in 2013-14, equivalent to 9 per cent of the whole tax take.

Absolute Best Earnings tax paid through constituency, outdoor London, 2013-14
Constituency Mean Income tax* Total Earnings tax
Esher & Walton £17,800 £1,080m
Windsor £14,000 £776m
Beaconsfield £Thirteen,900 £802m
Chesham & Amersham £Thirteen,800 £708m
Sevenoaks £Thirteen,200 £712m
 * Per taxpayer. Source: HM Revenue & Customs

This concentration of the tax burden is less acute than in property. The Ten constituencies that generate probably the most stamp responsibility on home purchases — all inside London — against this accounted for 20 per cent of nationwide revenues from the tax in 2014-15, probably the most Recent yr for which HMRC figures are on hand.

However, these 10 constituencies paid More Earnings tax Blended in 2013-14 than each person area except for London, the south-east and the east of England.

Residents in roughly one in three constituencies, usually lower incomes areas, paid less tax on average than in 2012-13. This coincided with a rise in the private allowance from £Eight,105 to £9,440, chopping Income tax payments through £267 a yr.

Lowest Profits tax paid by means of constituency, UK, 2013-14
Constituency Mean Earnings tax* Total Earnings tax
Wolverhampton NE £2,210 £82m
Walsall North £2,240 £81m
Blackpool South £2,250 £77m
Liverpool, Walton £2,260 £84m
Birmingham, Yardley £2,260 £87m
 * Per taxpayer. Source: HM Earnings & Customs

Regardless Of having succeeded in taking 3m or so low earners out of Profits tax altogether, further increases to the personal allowance is not going to benefit poorer households, consistent with Adam Corlett, financial analyst on the Decision Foundation. “The Main beneficiaries are two-Earnings households the place both people are in full-time work.”

Contemporary research by the assume tank concluded that 4-fifths of the features from future increases to the tax-free allowance — which is set to upward thrust to £Eleven,500 by 2017-18 — would go to the higher incomes half of of taxpayers.

Mr Corlett introduced that Not most effective do employees still need to pay nationwide insurance coverage on income above £Eight,060 a 12 months, but reforms to advantages can have a big impact on many low earners. For these households, the cuts to Earnings tax are “greater than overwhelmed” by way of deep benefit cuts.

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