Finance Act 1992

9 Lower rate

(1) Section 1 of the Taxes Act 1988 (the charge to income tax) shall be amended as mentioned in subsections (2) to (8) below.

(2) In subsection (2) the following paragraph shall be inserted before paragraph (a)—

“(aa) in respect of so much of an individual’s total income as does not exceed £2,000, at such rate as Parliament may determine to be the lower rate for that year;”.

(3) In paragraph (a) of subsection (2) after “within” there shall be inserted “paragraph (aa) above or”.

(4) The following subsection shall be inserted after subsection (2)—

“(2A) The amount up to which an individual’s income is by virtue of subsection (2) above chargeable for any year at the lower rate shall be known as the lower rate limit.”

(5) In subsection (3) after “at the” there shall be inserted “lower rate or the”.

(6) In subsection (4) for “the amount specified” there shall be substituted “each of the amounts specified”.

(7) In subsection (6) for “amount” there shall be substituted “amounts”.

(8) The following subsection shall be inserted after subsection (6)—

“(6A) Where income tax at the basic rate has been borne on income chargeable at the lower rate any necessary repayment of tax shall be made on the making of a claim.”

(9) In section 832(1) of the Taxes Act 1988 the following shall be inserted after the definition of “local authority association”—

““lower rate”, in relation to the charging of income tax for any year of assessment, means the rate of income tax determined in pursuance of section 1(2)(aa), and any reference to the lower rate limit shall be construed in accordance with section 1(2A);”.

(10) This section shall apply for the year 1992-93 and subsequent years of assessment.

(11) This section shall not require any change to be made in the amounts deductible or repayable under section 203 of the Taxes Act 1988 (PAYE) before 18th May 1992.