Since 6th April 2019, Welsh rates of Income Tax have been determined by the Welsh government instead of England’s. This means that the two are no longer automatically aligned. The Scottish system has a similar set up.
For the 2023/24 tax year, the rates are the same as for England, but this is subject to change every year:
Income Tax paid by Welsh residents now goes straight to the government in Wales, rather than via the government in England. The rates are set in the Welsh government’s annual draft budget in the autumn. They apply to non-savings and non-dividends earnings. For savings and dividends earnings, these are still taxed under the main UK rates.
You will pay either via the PAYE system (which means direct from your salary) or via a Self Assessment if you’re earning untaxed income.
You’ll owe Income Tax on the following types of income:
As a CIS worker, you’ll pay Welsh rates of Income Tax on your CIS earnings – but the deductions (either 20% or 30%) will be made aligning with the main UK system.
The Welsh rates will therefore affect the tax you owe and the rebate you’ll be eligible for. That said, in the 2023/24 tax year, the UK and Welsh rates are the same, so there will be no difference in either what you pay or what you have returned.
No. You will never have to pay both England and Welsh Income Tax on your earnings. You’ll always be taxed on either one or the other.
Nope! If you earn less than £100,000 per annum and pay tax via PAYE, you are already sorted and your income tax is being taken automatically from your wages before they even reach you.