The single person's income tax allowance for the year 2010/2011 is £6,475 (2009/2010 - £6,475). If your total income is less than this during the tax year then there's no tax to pay. Neither should you have to pay tax on interest on your savings. So if you're on a low income then your bank can provide you with Inland Revenue form R85 to apply for your interest to be paid gross.

Income tax bands 2009-2011

* From 2008-09 there is a 10 per cent starting rate for savings income only. If your non-savings income is above this limit then the 10 per cent starting rate for savings will not apply.

The self-employed can claim business expenses against their income. So make sure you include all possible justifiable business expenses on your self-assessment form.

You may be able to pay further contributions to your pension, which can soak up some unused tax relief. One other point to remember, if one spouse is a tax payer and the other is not it is worth considering switching some investments to take advantage of their unused tax allowances.

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