2021-22 Income Tax Rates in Wales

Since 6^th April 2019, the Welsh Assembly has had the power to set the rates of income tax in Wales for non savings and non dividend income.

HMRC still collect and administer your taxes, but the Welsh rates will be applied to your income tax calculation.

What are the Welsh rates of income tax in 2021-22 tax year?

The Welsh government has decided to keep the income tax rates for Wales the same as England and Northern Ireland for the 2021-22 tax year.

Your Personal Allowance amount is £12,570. So Welsh taxpayers can earn up to £12,570 before you have to pay any income tax at all.

Welsh Income Tax Rates 2021-22:

• Basic Rate of 20% on income between £12,571 and £50,270
• Higher Rate of 40% on income between £50, 271 and £150,000
• Additional Rate of 45% on income over £150,000

Who pays Welsh income tax rates?

Basically, you’re a Welsh taxpayer if you live in Wales. If you have more than one home and your ‘main home’ is in Wales, you’ll also pay income tax at the Welsh rates.

‘Main home’ means:

• “most of your possessions are
• your family lives, if you’re married or in a civil partnership
• you’re registered for things like your bank account, GP or car insurance
• you’re a member of clubs or societies”

How is my Welsh income tax spent?

The Welsh government has divided its budget into seven areas:

• health
• education
• social services
• economy, transport and agriculture
• environment, housing and communities
• general public services and safety
• recreation and culture”

You can see what proportion of your Welsh income tax is spent on each area using this free calculator.

How do I pay Welsh income tax?

You need to make sure that HMRC has the correct address for your main home in Wales. If you pay tax through PAYE, you’ll see a ‘C’ (for Cymru) at the start of your tax code. This tells everyone that you’re paying the Welsh rates of income tax.

If you pay through the Self Assessment process, you need to check the box to tell HMRC that you pay the Welsh rates.