The amount you are taxed can be affected by your age in that personal tax allowances increase as you get older.

In 2011-12 the tax allowance for people less than 65 years of age is £7,475, meaning that you can earn up to this amount before you need to start paying tax.

However providing earnings are below £24,000, the allowance increases to £9,940 for those aged between 65-74, and £10,090 for people aged 75 and over. For those aged 65+ and earning over £24,000 the personal allowance will decrease by £1 for every £2 of income above £24,000.

For example, if Helen is 67 years old and earns £24,500, her earnings exceed the £24,000 age allowance income limit by £500. Therefore her personal tax allowance will be £250 less bringing it down to £9,690.

If you are unsure about anything explained here or would like a quotation please do not hesitate to phone or email us, or alternatively, you can simply use the live chat link available.

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About The Author

Lee Murphy

MAAT and ICPA accountant, with a passion for making accountancy and bookkeeping accessible. Other interests include cloud-based software development for web and mobile access, keeping fit, reading, and entrepreneurship.

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