Welsh Tax Devolution
Three taxes in Wales are affected:
- Income Tax
- Stamp Duty Land Tax
- Landfill tax
Income Tax paid in Wales will directly fund Welsh Public Services
If you live in Wales, From 6th April 2019, HMRC will continue to collect your Income Tax as usual. However, for the first time, a proportion of that Income Tax will be transferred straight to the Welsh Government.
This is a change from the current system, where all income tax from Wales is paid to the UK government to fund spending across the UK.
The rates of Income Tax in Wales will be set by the Welsh Government.
From April 2019, the UK government will reduce each of the 3 rates of income tax – basic, higher and additional rate – paid by Welsh taxpayers by 10p. Each year, the Welsh Government will then decide the 3 Welsh rates of income tax, which will be added to the reduced UK rates. The combination of reduced UK rates plus the Welsh rates will determine the overall rate of income tax paid by Welsh taxpayers.
The Welsh Government proposes to set the first Welsh rates of income tax at 10p: this means the rates of income tax paid by Welsh taxpayers will continue to be the same as those paid by English and Northern Irish taxpayers.
The National Assembly will need to confirm this proposal through a motion prior to the final Budget.
Stamp Duty Land Tax
On 1 April 2018, Land Transaction Tax (LTT) replaced Stamp Duty Land Tax (SDLT) in Wales. Land Transaction Tax is now collected by the Welsh Revenue Authority (WRA) keeping the money in Wales.
From 1 April 2018, Landfill Disposals Tax (LDT) replaced landfill tax in Wales. This will be administered by the WRA and payable by landfill operators in Wales.
Gold Stag Accounts is an accounting practice based in Bishop’s Stortofrd, Hertfordshire.
For more information on Welsh taxes visit the WRA website.