How do the Welsh Rates of Income Tax (WRIT) work and do Welsh taxpayers pay differently in 2026/27?

Full answer

The Welsh Rates of Income Tax (WRIT) work by splitting the income tax you pay on earnings, pensions and most non-savings, non-dividend income into two parts. The UK Government reduces each main rate by 10p, and the Welsh Government then decides how many pence to add back for Welsh taxpayers. For 2026/27 the Welsh Government has set all three Welsh rates at 10p, so the combined rates are identical to England and Northern Ireland. A Welsh taxpayer therefore pays 20% basic rate up to £50,270, 40% higher rate to £125,140, and 45% additional rate above that, after the £12,570 personal allowance (which tapers away by £1 for every £2 of income over £100,000). Unlike Scotland, Wales has not introduced extra bands such as a 21% intermediate or 42%/45% bands, and Welsh taxpayers do not have a separate set of band thresholds. WRIT applies only to non-savings, non-dividend income. Tax on savings interest and dividends stays fully reserved to the UK Government, so the £1,000/£500 Personal Savings Allowance, the £500 dividend allowance and dividend rates of 10.75%/35.75%/39.35% are the same wherever you live. National Insurance, Capital Gains Tax and Inheritance Tax are also UK-wide. Your status as a Welsh taxpayer is decided by where your main home is, not where you work; HMRC flags this with a tax code beginning with the letter C (for Cymru). For example, a worker earning £35,000 in Cardiff pays exactly the same income tax as one earning £35,000 in Bristol. The only devolved property tax difference is Land Transaction Tax (LTT), which replaces Stamp Duty on Welsh property purchases and has no first-time buyer relief.

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