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Extra Personal Allowance

Additional Personal Allowance

What Is Additional Personal Allowance?

The term extra personal allowance alludes to an extra tax deduction set forward by HM Revenue and Customs (HMRC) on income tax returns in the United Kingdom. This deduction applied to single, separated, or widowed people who were not eligible to receive the married couple allowance and who monetarily upheld a child younger than 16. The extra personal allowance was nullified in 2000.

How Additional Personal Allowance Worked

Income taxes are documented with and collected by HM Revenue and Customs in the United Kingdom. This agency is the British equivalent of the Internal Revenue Service (IRS). British taxpayers are charged income tax on various types of income, including wages from employment, self-employed profits, state benefits, pension earnings, rental and trust income, and any benefits earned from an employer. Taxes are exempt on an assortment of income sources including:

  • The first \u00a31,000 of self-employment earnings
  • The first \u00a31,000 earned from a rental property
  • Rewards from the National Lottery
  • Certain profits

A personal allowance reduces a person's tax liability. Just like the standard deduction in the United States, the portion of income isn't subject to taxation. Anything over the personal allowance — that is, anything that remains over after the personal allowance is deducted — is taxed at the current tax rate.

Certain taxpayers had the option to claim an extra personal allowance to reduce their tax bill even further. This allowance was in effect until April 2000. Single people, along with the individuals who were separated or widowed had the option to utilize it as long as they didn't claim the allowance for married couples.

Anybody claiming the extra personal allowance was required to be monetarily supporting a child under 16. Parents could likewise claim the benefit for children beyond 16 years old that were full-time understudies or who were part of a two-year disciple program. The allowance likewise applied to men with a debilitated spouse and a qualifying child younger than 16 residing in the household, gave the wife was weakened over time.

As per British tax law, a qualifying child is a child of the claimant or a child that is upheld and cared for by the claimant. Just a single allowance was paid, no matter what the number of children cared for by the person claiming the extra allowance.

Special Considerations

As verified over, the extra personal allowance was disposed of in April 2000. This means each taxpayer is subject to a similar personal allowance, paying little mind to marital status, orientation, and whether they have children. The standard personal allowance in the U.K. for the 2020-2021 tax year is \u00a312,500. There is no income tax payable on any income earned under this amount. The amount of income tax paid in each tax year really relies on how much earnings are over the personal allowance and the amount of a person's income falls inside the different tax bands.

The standard personal allowance for the 2020-2021 tax year for British taxpayers is \u00a312,500.

Illustration of the Additional Personal Allowance

Here is a speculative guide to show how the extra personal allowance functioned. Suppose a widow named Olivia had 12-year old child living her in 1998. Under the British tax system, Olivia had the option to claim an allowance past the standard personal allowance even however she was not generally married following the death of her better half two years prior. This extra allowance assisted Olivia with paying less in income taxes for the year.


  • The extra personal allowance was an extra deduction permitted by HM Revenue and Customs on income tax returns documented in the United Kingdom.
  • The extra personal allowance was disposed of in 2000.
  • The individuals who qualified were required to be monetarily supporting a child under 16.
  • This allowance gave tax relief to the individuals who qualified — single, separated, or widowed taxpayers who didn't utilize the married couple allowance.