Advanced Taxation (UK) · Taxes applicable to a given situation or course of action and their impact

Using the ATX-UK Tax Rates, Allowances and Supplementary Instructions

Updated 11 October 2026 · Fact-checked

In ATX-UK, the exam reproduces the tax rates, allowances and supplementary instructions for you. You must pick the right table, apply it to the facts given, and follow the instructions: 2025/26 rates continue, round to the nearest £, apportion to the nearest month, and show all workings.

Understand Using the Tax Rates, Allowances and Supplementary Instructions

ATX-UK is a written exam. You do not need to memorise most rates. ACCA reproduces the tax rates and allowances in the exam, along with four supplementary instructions. Your skill is choosing the right figure, applying it correctly and stating your assumptions.

The current tables apply to exams from 1 June 2026 to 31 March 2027 and in June 2027. They are based on the Finance Act 2025, which received Royal Assent on 20 March 2025. Prospective legislation is not normally examined until it actually takes effect.

The first supplementary instruction matters most. You assume the tax rates and allowances for 2025/26, and for the financial year to 31 March 2026, continue for the foreseeable future unless the question says otherwise. So if a question looks forward to a later year, use the same rates. Do not guess at changes.

The other instructions are about presentation. Calculations need only be to the nearest £. Apportionments are made to the nearest month. All workings must be shown. A correct figure with no working loses marks, and a wrong figure with clear working still earns credit.

The tables are also not everything. The exam gives other specific information in each question. Where a rule is not in the tables, such as how a relief works, you must know it. The tables give you the numbers, not the conditions for using them.

Key rules to remember

Corporation tax rates: Small profits rate 19%; main rate 25%; lower limit £50,000; upper limit £250,000; Same for financial years 2023, 2024 and 2025. Limits are reduced for associated companies and short accounting periods.
Marginal relief: (Upper limit − Augmented profits) × 3/200 × Taxable total profits ÷ Augmented profits; Applies where augmented profits are between the lower and upper limits. The standard fraction is 3/200.
Income tax normal rates: Basic £1 − £37,700 at 20%; higher £37,701 − £125,140 at 40%; additional over £125,140 at 45%; Dividend rates are 8.75%, 33.75% and 39.35% for the same bands.
Savings and dividend nil rate bands: Savings nil rate: £1,000 basic rate, £500 higher rate. Dividend nil rate: £500; The 0% starting rate for savings applies where savings income falls within the first £5,000 of taxable income.
CGT rates and allowances: Lower rate 18%; higher rate 24%; annual exempt amount £3,000; BADR and investors' relief rate 14%, lifetime limit £1,000,000 each; Lower rate applies to gains falling within any unused basic rate band.
Inheritance tax: Nil rate band £325,000; residence nil rate band £175,000; lifetime rate 20%; death rate 40%; Taper relief reduces tax on death: 20% (3-4 years), 40% (4-5), 60% (5-6), 80% (6-7).
Interest rates (assumed): Official rate 3.75%; underpaid tax 8.50%; overpaid tax 3.50%; Use the official rate for beneficial loans. Use the underpaid and overpaid rates for late or overpaid tax.
Capital allowances: Main pool 18%; special rate pool 6%; AIA 100% up to £1,000,000; structures and buildings allowance 3% straight line; Companies also get 100% first year allowance on main pool and 50% on special rate pool plant.
Other tables: Mileage: 45p to 10,000 miles, 25p over. Reliefs cap: higher of £50,000 or 25% of income. SDLT non-residential: 0% to £150,000, 2% to £250,000, 5% above. Stamp duty on shares 0.5%; SDLT is a slice system on non-residential property. Apply each rate only to the part of the price in that band.

How to solve Using the Tax Rates, Allowances and Supplementary Instructions questions

Use this method for any question that needs figures from the tax tables.

1Read the requirement and note the tax year or financial year involved, and who the taxpayer is (individual, company, trust or estate).
2Check whether the question gives its own rates or dates. If it does, use them. Otherwise assume 2025/26 rates continue.
3Pick the right table for the tax and the taxpayer. Check each rate is for the right type of income, such as normal, savings or dividend.
4Check the limits and conditions: reduce thresholds for associated companies or short periods, and note whether the facts qualify for the relief.
5Compute to the nearest £, apportioning to the nearest month. Lay out every working with a clear label.
6State any assumption in one line, for example that the 2025/26 rates continue to apply.
7Sense-check the answer, such as an effective rate that falls between the lowest and highest rates.

Quickest way: Table-first in two minutes

When to use it: Use this at the start of any numerical requirement, when time is tight.

Before you calculate, write the two or three table figures you need at the top of your answer.
Underline the tax year and the taxpayer type in the question.
Compute in a layout where each line has a label, so marks are easy to award.
Write the assumption line once, then move on.

Common mistakes in Using the Tax Rates, Allowances and Supplementary Instructions

Using the wrong rate for the type of income, such as the 20% rate on dividends.
Students see the first column of the income tax table and stop.
Fix: Split income into non-savings, savings and dividends first. Match each to its own rate and nil rate band.
Forgetting to reduce corporation tax limits for associated companies or a short accounting period.
The table shows £50,000 and £250,000 and students use them automatically.
Fix: Check the facts for associated companies and the length of the period before applying the limits.
Rounding too early or to pence.
Habit from other exams.
Fix: Follow the instruction: nearest £. Keep working figures sensible and round in the final line of each computation.
Applying the 5% SDLT rate to the whole price.
Students think of it as a single rate.
Fix: Use the slice bands: nothing on the first £150,000, 2% on the next £100,000, 5% on the rest.
Showing only the answer with no working or assumption.
Students rush to save time.
Fix: Show every working, as the instructions require. State the assumption that 2025/26 rates continue.
Using the wrong interest rate, such as the official rate for late tax.
Three rates sit in one table.
Fix: Official rate is for beneficial loans. 8.50% is for underpaid tax. 3.50% is for overpaid tax.

Worked examples

Example 1

A UK company has taxable total profits of £200,000 and no other income or associated companies, in a 12-month period in the financial year 2025. There are no distributions received. Compute the corporation tax liability.

Show the solution

Augmented profits = £200,000, which is between £50,000 and £250,000, so marginal relief applies.
Tax at main rate: £200,000 × 25% = £50,000.
Marginal relief = (£250,000 − £200,000) × 3/200 × (£200,000 ÷ £200,000) = £50,000 × 0.015 × 1 = £750.
Tax payable = £50,000 − £750 = £49,250.

Answer: Corporation tax liability is £49,250.

Example 2

A company buys a non-residential building for £300,000. Compute the SDLT payable, and the stamp duty on a separate purchase of shares for £40,000.

Show the solution

First £150,000 at 0% = £0.
Next £100,000 (£150,001 to £250,000) at 2% = £2,000.
Remaining £50,000 at 5% = £2,500.
SDLT = £2,000 + £2,500 = £4,500.
Stamp duty on shares = £40,000 × 0.5% = £200.

Answer: SDLT is £4,500 and stamp duty on the shares is £200.

Exam tips

Treat the supplementary instructions as part of the marking scheme. Show workings and state your assumptions.
Print or open the tax tables early in practice so you know where each one sits.
Do not quote rates from memory when the exam gives them. Spend the time on applying them.
If the question gives its own rate or date, it overrides the default assumption that 2025/26 rates continue.
Remember the tables give numbers, not conditions. Learn the rules for each relief separately.

Practice questions from Taxes applicable to a given situation or course of action and their impact

Using the Tax Rates, Allowances and Supplementary Instructions: frequently asked questions

Are tax rates provided in the ATX-UK exam?

Yes. ACCA reproduces the supplementary instructions and the tax rates and allowances in the exam. Other specific information needed is given in each question.

Which Finance Act applies for June 2026 to June 2027 exams?

The Finance Act 2025 applies, which received Royal Assent on 20 March 2025. This covers exams from 1 June 2026 to 31 March 2027 and in June 2027.

What should I assume about future tax rates?

Assume the rates and allowances for 2025/26, and for the financial year to 31 March 2026, continue for the foreseeable future. The exception is where the question tells you otherwise.

How accurate must my calculations be?

Calculations need only be to the nearest £. Apportionments should be to the nearest month. Always show all workings so marks can be awarded even if a figure is wrong.