It has recently been revealed that HM Revenue and Customs (HMRC) has written letters to two million people in Wales, ahead of the introduction of new Welsh Rates of Income Tax (WRIT) in April next year.
The changes to the system will be implemented from 6 April. Income Tax will continue to be collected in the same manner as before within pay and pensions through PAYE and Self-Assessment.
However, the Welsh Government will now set its own Income Tax rates and WRIT taxpayers will receive a new tax code starting with C for Cymru.
The system is changing to allow for a portion of the money to be sent straight to the Welsh Government where it can be spent on public services in Wales.
This is a change from the current arrangement, where all income tax from Wales is paid to the UK government to fund spending across the UK.
Angela MacDonald, Director General for HMRC Customer Services, said:
“We want to help people pay the right tax so we’re writing to customers to let them know that they’ll now be paying WRIT.
“Customers don’t need to do anything right now but should make sure to keep HMRC informed if their details change in the future.”
For more information on how to update your details online, please go to www.gov.uk/tell-hmrc-change-of-details.
Here at Thorne Widgery, our team of tax experts can help anyone who is likely to be affected by these changes and are encouraging our customers to contact us if they have received a letter so that we can update our records and provide specialist advice.