HMRC’s latest figures for the number of taxpayers for 2024/25 are broken down by age, sex and marginal rate of income tax (basic rate, higher rate and additional rate).
Broadly, a person pays income tax when their income for the year exceeds the personal allowance (£12,570 for 2024/25). A person’s marginal rate is the rate of income tax that an extra £1 of income would be taxed at. Scottish taxpayers are included according to the marginal rate that corresponds to the basic, higher or additional rate.
Key figures
The total number of taxpayers for 2024/25 is expected to increase by approximately 3.3% compared with 2023/24, and by 13.3% compared with 2021/22.
It is estimated that in 2024/25 the marginal rate will be the basic rate for 29.5m taxpayers, higher rate for 6.3m taxpayers, and additional rate for 1.1m taxpayers. There has been a 5.2% increase compared to 2023/24, and a 42.4% increase compared to 2021/22, for taxpayers in the higher rate category. 2024/25 will be the first year in which the number of additional rate taxpayers has exceeded 1m.
Since 2021/22, the personal allowance has been frozen at £12,570, and the threshold at which individuals start paying income tax at the higher rate in England, Wales and Northern Ireland has been frozen at £37,700 (£50,270 including the personal allowance).
ICAEW’s view
Caroline Miskin, ICAEW Senior Technical Manager, Digital Taxation, says: “These figures mean more work for an already stretched HMRC. In a recent report, the National Audit Office found that taxpayers spent the equivalent of 798 years waiting on HMRC helplines in 2022/23. This can only get worse as frozen allowances and thresholds drag more people into the tax system, and more people have to deal with complex tax rules. It remains to be seen whether the additional funding of £51m for HMRC announced in May will be enough to help HMRC improve its services to taxpayers.
Further reading
- Taxpayers let down by poor HMRC service, says NAO
- Tax thresholds in deep freeze
- Ways to tackle tax threshold unfairness
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