The Welsh Government and the National Assembly for Wales take responsibility for some of the taxes paid in Wales in April 2018.
Three taxes in Wales are affected by the partial devolvement:
• Stamp duty land tax;
• Landfill tax; and
• Income tax.
Land transaction tax (LTT)
From 1 April 2018, Land Transaction Tax (LTT) replaces Stamp Duty Land Tax (SDLT) in Wales. LTT will be collected by the Welsh Revenue Authority (WRA). The Welsh rates and bands for LTT were published in October 2017.
The change means that HMRC will not accept SDLT returns for land transactions in Wales with an effective date of transaction on or after 1 April 2018.
The Welsh Revenue Authority has launched an online LTT calculator to help taxpayers work out the amount of LTT they will need to pay on Welsh transactions completed on or after 1 April 2018.
From 1 April 2018, Landfill Disposals Tax (LDT) replaces landfill tax in Wales. This will be administered by the WRA and payable by landfill operators in Wales.
Landfill site operators in Wales can register for LDT via the Welsh Government website.
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. The National Assembly for Wales 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. Other aspects of income tax will continue to be decided by the UK government, and the tax will be collected by HMRC. Revenue from the Welsh rates of income tax will go to the Welsh Government.
If the National Assembly sets each of the Welsh rates of income tax at 10p, this will mean the rates of income tax paid by Welsh taxpayers will continue to be the same as that paid by English and Northern Irish taxpayers.
The National Assembly may decide to set different rates to reflect Wales’ unique social and economic circumstances.