This guide looks at Northern Ireland's tax rates.

What is the rate of Income Tax for Northern Ireland? What rate is Northern Irish Tax? 

Tax Bands & Rates

These remain the same as the rest of the UK, excluding Scotland

 

 

Income band £

Rate

Tax Rate %

2020/21

2019/20

2018/19

Personal allowance (tax-free band)

0

0-12,500

0-12,500

0-11,850

Basic rate

20

12,500-50,000

12,500-50,000

11,850-46,350

Higher rate

40

50,000-150,000

50,000-150,000

46,350-150,000

Additional rate

45

150,000+

150,000+

150,000+

 

At a glance

  • HMRC continue to issue tax codes for employees in Northern Ireland as for employees in England.  
  • Any non-UK residents who own property in Northern Ireland remain subject to UK rates and allowances.
  • If you are non-UK resident with a Northern Irish correspondence address with HMRC, you should update them with your address abroad. Then, if you so wish, request that correspondence continues to be sent to your Northern Irish address. This should avoid any incorrect HMRC tax computations.
  • Taxpayers must keep their address details up to date with HMRC to allow them to identify them as Northern Irish residents.

Key points to note

  • Applies to non-savings income, including employment, self-employment, pension and rental income.
  • Savings and dividend income are not affected.
  • National Insurance Contributions are not affected.
  • There are no special rules for partnerships, although individual partners who are Welsh taxpayers will be affected.
  • The residence status of Trusts will not be affected and trustees will continue to be taxed at UK rates.
    • Discretionary beneficiaries receiving income from trusts will be affected.
    • Personal representatives dealing with the estates of deceased persons will continue to be taxed at UK rates.
    • Income received from an estate or an interest in possession trust will continue to be taxed at UK rates. 
  • We have seen no announcements about Gift Aid or pension contributions. If this follows the treatment for Scottish Income Tax Gift Aid will continue to operate in the same way (charities recover 25% of net donations, taxpayer extends basic rate band).
  • The UK Government has been in discussions with charitable bodies concerning the impact of donors liable at devolved rates of Income Tax in respect of Scottish tax and it was decided that Gift Aid would continue to apply at basic rate regardless of the position of the donor. The same applies to Northern Irish donors but should the rates diverge further the position will be reconsidered. 
  • Frontier workers pay Income Tax in the country where they work but must deliver an annual Self Assessment return where they live. 
    • A frontier worker is a worker who lives in one EU member state and works in another and returns home daily or weekly.
    • Southern Irish residents working in Northern Ireland will pay tax directly to HMRC but submit an annual return to the Irish Revenue. They will obtain Transborder Workers Relief under the Double Taxation Treaty between the UK and Ireland so that they do not pay additional Irish tax on their employment income. They will pay Irish tax on other sources of Irish sources such as rental or investment income. 
    • Northern Irish residents working in Southern Ireland will pay tax directly to the Irish Revenue but will need to submit an annual Self Assessment return to HMRC. They may be eligible for foreign tax credit relief under the Double Tax Treaty Agreement with the UK and Ireland. 

 

 

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