Beat UK’s £199 Billion Income Tax Bill

Beat UK’s £199 Billion Income Tax Bill
Shutterbug75 / Pixabay
  • There were 31.6 million income tax payers in 2018/19, and there will be 32.2 million in 2021/22, as a combination of employment and population increases alongside the freeze in the personal allowance.

Get The Full Henry Singleton Series in PDF

Get the entire 4-part series on Henry Singleton in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues

Q1 2021 hedge fund letters, conferences and more

  • In 1999/2000 we paid £93 billion in income tax. This rose to £187 billion in 2018/19 and is expected to hit £199 billion by 2021/22.
  • There will be 27 million basic rate taxpayers in 2021/2022, which is a 2.6% increase from 2018/2019. They’ll make up 83.2% of income taxpayers.
  • There will be 4.13 million higher rate taxpayers in 2021/2022, which is down 2.4% from 2018/2019. They’ll make up 13.1% of income taxpayers
  • There will be 440,000 additional rate tax payers in 2021/2022, up 10.3% from 2018/2019.

HMRC has issued statistics on income tax.

The £199 Billion Income Tax Bill

Sarah Coles, personal finance analyst, Hargreaves Lansdown:

Fund Manager Profile: Kris Sidial Of Tail Risk Fund Ambrus Group

invest Southpoint CapitalA decade ago, no one talked about tail risk hedge funds, which were a minuscule niche of the market. However, today many large investors, including pension funds and other institutions, have mandates that require the inclusion of tail risk protection. In a recent interview with ValueWalk, Kris Sidial of tail risk fund Ambrus Group, a Read More

“The government is going to take £199 billion of our hard-earned money in income tax in 2021/22, more than twice the sum it took in 1999/2000.

We’ve had a few years of more positive news for higher earners, because the personal allowance has been rising gradually, and we’ve seen a bump in the higher rate tax threshold too, so the proportion of people paying higher rate tax has dropped.

Unfortunately, things are set to get far grimmer for the next few years. The freeze in the personal allowance and higher rate tax threshold means more people will pay more tax, and the number of higher rate taxpayers will grow again. By 2021/22 it will still be below its 2018/19 level, but it’ll soon be back over it again.

And while we’re happy to pay our fair share of tax, we can’t afford to pay over-the-odds. So it’s worth considering some simple steps to protect your income from tax.

ISAs can protect income from investments from tax. If you’re saving to buy a first property and are aged 18-39, you should also consider a Lifetime ISA, because in addition to tax free growth, you get a 25% bonus on contributions.

Contributions to pensions, meanwhile, attract tax relief at your highest marginal rate, and the first 25% taken from the pension is usually tax-free. There’s tax relief on pensions even for non-taxpayers – on the first £3,600 a year.

In some cases, the government will let you give up a portion of your salary, and spend it on certain things free of tax (and in some cases national insurance). This includes pensions, childcare vouchers, bike-to-work schemes, and technology schemes.

And you can take advantage of the spouse exemption that means assets that produce an income can be passed between spouses without triggering a tax bill. They can therefore be shared between a couple, so that both take advantage of their allowances. The balance can be held by the spouse paying the lower rate of tax, to reduce the tax payable.

Other Figures In This Release

  • In 2018/19, 42.7% of taxpayers were women (13.5 million), and 57.3% are men (18.1 million). At the time, 49.8% of the population over the age of 16 was male.
  • For 2020/21, this is expected to become even more unbalanced, as women make up 42.5% of taxpayers and men 57.5%, as the number of male taxpayers rises more quickly.
  • In 2018/19 6.5 million taxpayers (20.6%) are over the state pension age. They made up 22.9% of the population at that point.
  • Basic rate taxpayers will pay an average of 9.5% of all their income in tax. For higher rate taxpayers it’s 22% and for additional rate taxpayers 38.1%
  • In 2018 to 2019 the bottom 50% of income taxpayers paid 9.5% of total tax, whilst the top 50% paid 90.5%. In 2021 to 2022, the bottom 50% of Income Taxpayers are expected to pay 9.4%, and the top 90.6%.

About us

Over 1.6 million clients trust us with £132.9 billion (as at 30 April 2021), making us the UK’s largest digital wealth management service. More than 98% of client activity is done through our digital channels and over 600,000 access our mobile app each month.

Jacob Wolinsky is the founder of, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at) - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver
Previous article Engine No. 1 Receives $100M To Start Its ESG-Focused ETF
Next article Coronavirus stimulus check: California working on biggest rent forgiveness program in U.S.

No posts to display