[ˈɪnkʌm tæks]
Income Tax is a levy on personal income collected by HMRC to fund public services. The rate changes depending on how much you earn.
Income Tax is a Tax collected by HMRC that is applied to most forms of personal income. Revenue collected is spent on the running of public services.
Income Tax must be paid on any income earned above the Personal Allowance. The rate of tax you pay depends on the tax band you fall in. Income Tax is a Marginal Tax. For the 2023/24 Tax Year, Basic Rate (£12,571 - £50,270) is at 20%, Higher Rate (£50,271-£125,140) is at 40% and Additional Rate (£125,141+) is at 45%. You can lose your Personal Allowance as your income increases.
Most people pay Income Tax through PAYE, where your Tax Code tells employers how much of your salary to deduct for tax payments. A Self Assessment may be required for other forms on income like Self-employed profits.
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The festive period is often thought of as the busiest time of the year with the run up to Christmas and New Year. Whilst this period can feel hectic at times, it can also be seen as the perfect time to complete your tax return. In this article we explain why this Christmas time is the best time to submit your 22/23 tax return.
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