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United Kingdom

Overview

Last reviewed - 12 February 2024

The United Kingdom (UK) is located off the north-western coast of continental Europe. The capital of the United Kingdom is London, and the official language is English.

The United Kingdom has historically played a leading role in developing parliamentary democracy and in advancing literature and science. Today, the United Kingdom is a modern and prosperous European nation. As one of five permanent members of the United Nations (UN) Security Council, a founding member of the North Atlantic Treaty Organisation (NATO), and a member of the Commonwealth, the United Kingdom pursues a global approach to foreign policy. The United Kingdom was a member of the European Union (EU) until 31 January 2020, although it always chose to remain outside the Economic and Monetary Union, and so retained the pound sterling (GBP) as its currency rather than adopting the euro. The transitional exit period ended on 31 December 2020, resulting in a number of changes as a consequence of various EU tax measures ceasing to apply.

On 22 September 2022, the government introduced the Retained EU Law (Revocation and Reform) Bill, which makes provision for significant changes to the status and operation of retained European law. However, the government has confirmed that any changes required to retained tax law will be made through a Finance Bill or secondary tax legislation. Separate provisions were made for retained EU law relating to value-added tax (VAT), excise, and customs duty in a future Finance Bill, and although at the time of writing, the November 2023 Finance Bill in which this legislation is contained is progressing through the House of Commons, the government has used a parliamentary mechanism, the Provisional Collection of Taxes Act 1968, to give legal force to a resolution concerning the interpretation of VAT and excise law, as a consequence of which UK VAT and excise law that was in force prior to 1 January 2021 (EU exit day) will continue to be interpreted in line with EU law principles. 

The United Kingdom, a leading trading power and financial centre, is one of the quintet of trillion dollar economies of Western Europe. Services, particularly banking, insurance, and business services, account by far for the largest proportion of gross domestic product (GDP). Specialist engineering, aerospace, biotechnology, pharmaceuticals, and information technology are lead sectors, and the United Kingdom has relative strengths in the new digital technology sectors that have emerged over the past decade or so (AI, fintech, digital media, etc.), while the manufacturing industry continues to decline in importance. Agriculture is intensive, highly mechanised, and efficient by European standards, producing about 60% of food needs with less than 2% of the labour force. The United Kingdom has significant but declining natural gas and oil resources and is a net importer of energy.

PwC in the United Kingdom offers assurance, tax, and advisory services at multiple locations. PwC's tax consultancy helps businesses and individuals understand the impact of taxation on business decisions.

Quick rates and dates

Corporate income tax (CIT) rates
Headline CIT rate (%)

25

Corporate income tax (CIT) due dates
CIT return due date

The tax return needs to be filed within one year from the end of the accounting period.

CIT final payment due date

Varies according to the size of the company making the payment. See the UK Corporate summary for more information.

CIT estimated payment due dates

Varies according to the size of the company making the payment. See the UK Corporate summary for more information.

Personal income tax (PIT) rates
Headline PIT rate (%)

45 (the basic rate starts at 20%, the higher rate is 40%, and the 45% rate is for income over GBP 125,140). Different rates apply for Scottish residents.

Personal income tax (PIT) due dates
PIT return due date

31 January following the end of the tax year.

PIT final payment due date

31 January following the end of the tax year.

PIT estimated payment due dates

Two instalments, on 31 January during the tax year and on 31 July following the tax year.

Value-added tax (VAT) rates
Standard VAT rate (%)

20

Withholding tax (WHT) rates
WHT rates (%) (Dividends/Interest/Royalties)

Resident: 0 / 20 / 20;

Non-resident: 0 / 20 / 20

Capital gains tax (CGT) rates
Headline corporate capital gains tax rate (%)

Capital gains are subject to the normal corporation tax rate.

Headline individual capital gains tax rate (%)

See the United Kingdom's individual tax summary for capital gain rates.

Net wealth/worth tax rates
Headline net wealth/worth tax rate (%)

NA

Inheritance and gift tax rates
Headline inheritance tax rate (%)

The standard inheritance tax rate is 40%. It’s only charged on the part of one's estate that’s above the nil rate band (currently GBP325,000). See the Other taxes section in the Individual tax summary.

Headline gift tax rate (%)

There is no specific gift tax in the UK. Instead, gifts made to individuals are subject to inheritance tax at rates up to 40% if the donor dies within seven years of making the gift. Gifts to any other entities (e.g. to trusts) can attract an immediate 20% IHT charge with a further charge if the individual dies within seven years of the gift.

NA stands for Not Applicable (i.e. the territory does not have the indicated tax or requirement)

NP stands for Not Provided (i.e. the information is not currently provided in this chart)

All information in this chart is up to date as of the 'Last reviewed' date on the corresponding territory Overview page. This chart has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this chart, and, to the extent permitted by law, PwC does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.