PLEASE NOTE: The charity TaxAid advises only those people on low incomes whose problems cannot be resolved with HMRC.

Income tax is charged for each tax year separately

Income Tax

The income tax you pay is calculated on your income in the tax year.  The tax year runs from 6 April in one year to 5 April in the next. Your tax free Personal Allowance, as well as the tax rates and bands, depend on which tax year you are looking at. Sometimes there are big differences in the way income is taxed between tax years, so it is very important to know the rules for the tax year you are looking at. Don’t assume it will be just the same as last year.

This guide is written based on the tax rules for 2017-18 and 2016-17. We do this because people who are self-employed will need to look back one tax year to complete their tax returns (tax returns for the tax year 2016-17 will be due for submission from April 2017 onwards), while people who are employed will need the rates for the current tax year.

Tax years are normally referred to by the year they start and end in (or even just the year they end in), so the tax year starting on 6 April 2016 and finishing on 5 April 2017 is called the tax year 2016/17 (or simply the 2016 tax year).