Welsh rates of income tax (WRIT) came into effect from 6 April 2019.
HMRC will tell employers which tax code is appropriate to apply to an employee in advance of the introduction of the Welsh rates of income tax.
Tax codes for Welsh taxpayers will be prefixed with a ‘C’. If an employee has been identified as a Welsh taxpayer it will be because they:
are resident in the UK for tax purposes
have had a main place of residence in Wales for more of the year than in any other part of the UK.
If an individual is a UK taxpayer and their main place of residence is in Wales, they’ll be a Welsh taxpayer.
However, if an individual cannot identify one place in Wales, the rest of the UK (England/Northern Ireland), or Scotland as their main place of residence they’ll need to determine where they’ve spent the most days; if this is Wales they’ll be a Welsh taxpayer.
Employers need to use payroll software or operate a set of tax tables to perform a tax calculation for those employees who are Welsh taxpayers. There’ll be no change to reporting or how payments for income tax are made to HMRC other than to apply the appropriate Welsh tax code to Welsh employees for all pay frequencies. Personal allowances will remain the same as in the rest of the UK. Tax bands will remain the same as in England and Northern Ireland.