If you live in Wales your income tax will go towards funding Welsh public services from 6th April 2019. Currently all income tax paid by people living in Wales goes to the UK Government and is added to the pot of funds for spending across the whole of the UK.
What does this income tax change mean for those living in Wales?
There will be no changes to the way tax is collected by HMRC but the rates of income tax paid will be set by the Welsh Government for the first time from 6th April 2019. The Welsh Government will be able to vary the rate which is to be paid by tax payers living in Wales. This means that people living in Wales could end up paying a different rate compared to others in the UK.
Once this comes into effect in April, the UK government will reduce each of the 3 rates of income tax – basic, higher and additional rate – paid by Welsh taxpayers by 10p. The Welsh Government will then decide the 3 Welsh rates each year, which will be added to the reduced UK rates.
The total sum of reduced UK rates plus the Welsh rates will determine the overall rate paid by Welsh taxpayers. As The Welsh Government proposes to set the first rates at 10p Welsh taxpayers will continue to pay the same income tax rates as those paid by English and Northern Irish taxpayers.
For more information about this, visit the Welsh Government website.
if you need any help or advice with your tax affairs, our tax team will be happy to talk it through with you, call 01244 400315 or email [email protected].