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Working out whether you're a taxpayer

To work out if you're a taxpayer follow these three steps:

• add up all your taxable income 
• work out your tax-free allowances 
• take your tax-free allowances away from your taxable income

Step one - add up your taxable income

Some income is taxable and some is never taxed. To see if you're a taxpayer, you first add up your taxable income in a tax year (6 April to 5 April) - you can ignore your non-taxable income. To view or print off a list of taxable and non-taxable income, follow the link below.

• Taxable and non-taxable income at a glance

Step two - add up your tax free allowances

Tax-free allowances are amounts of income you can get without paying tax. They include the Personal Allowance and the Blind Person's Allowance.

Personal Allowance

Everybody gets the basic Personal Allowance, but if you're 65 or over and your income is below certain levels the rate increases.

Personal Allowance rates	2009-10	Income limit (see note)
Basic	£6,475	none
Age 65 to 74	£9,490	£22,900
Age 75 or over	£9,640	£22,900

Note: If your income is over the income limit, HMRC will reduce the age-related allowance by half of the amount - £1 for every £2 - you have over that limit, until the basic rate allowance is reached.

You'll always get the basic allowance, whatever the level of your income. So if, for example, you're 66 and have an income of £23,500 (£600 over the limit) they would reduce your age-related allowance of £9,490 by £300 to £9,190.

Blind Person's Allowance

If you're certified blind and are on a local authority register of blind persons, or if you live in Scotland or Northern Ireland and you are unable to perform any work for which eyesight is essential, you can claim Blind Person's Allowance. If you're married or in a civil partnership and can't use all your allowance, you can give the unused part to your spouse or civil partner.

Even if you have no taxable income, it might still be worth claiming Blind Person's Allowance as your spouse or civil partner could benefit from your allowance. The Blind Person's Allowance for the tax year 2009-10 is £1,890.

• Blind Person's Allowance

Step three - work out if you're a taxpayer

Take your tax-free allowances away from your taxable income. If there's anything left, you count as a taxpayer and must contact HMRC if you're not already paying tax. If there's nothing left you shouldn't be paying any tax and may be due a refund.

• Contact details for all Tax Offices Opens new window

• Tax refunds and reclaiming overpaid tax

Taxpayer: worked example

You are 76 and registered blind. You've added up your taxable income and it comes to £19,000.

• your taxable income is £19,000
• your tax-free allowances add up to £11,530 (age-related Personal Allowance of £9,640 plus Blind Person's Allowance of £1,890)
• you subtract your tax-free allowances (£11,530) from your taxable income (£19,000) - this leaves you with taxable income of £7,470

Non-taxpayer: worked example

You are 46 and have a part-time job. Your taxable income is £4,500.

• your taxable income is £4,500
• your tax-free allowance is £6,475 - the basic Personal Allowance
• you subtract your Personal Allowance (£6,475) from your taxable income (£4,500) and find that you don't need to pay tax on your income
• if you have been paying tax, you may be due a refund

Allowances that can reduce your tax

Bear in mind that even if you count as a taxpayer, you may qualify for certain 'tax deductible' allowances that can reduce your tax bill, or in some cases mean you have nothing to pay. Read the guide below to find out more.

• Introduction to tax allowances and reliefs

More useful links

• Do you need to complete a tax return?

• Check up-to-date figures for personal allowances from HMRC Opens new window

• Tax on benefits pensions and maintenance