As we reported in GMS Flash Alert 2022-172, the Chancellor of the Exchequer, Kwasi Kwarteng, announced a Growth Plan to the U.K. Parliament on 23 September.1 As part of this Growth Plan, the Chancellor had announced that the 45% top rate of income tax would be abolished from 6 April 2023.2

However, following significant push-back from across the political spectrum, the Chancellor has now announced that the proposed abolition of the 45% top rate will not go ahead.3


The personal income tax rates are of great interest to employers, as these impact the cost of assignments, payroll withholding, and hypothetical tax deductions.

Employers appreciate certainty when planning assignments, and therefore may be concerned that the government is announcing changes to the income tax rates only to roll these back a week later.

What Will Change, What Will Not

The additional rate of income tax currently applies at a rate of 45% for income over £150,000.  Although it was originally announced in the Growth Plan that this would be abolished from 6 April 2023, this will no longer be going ahead. 

The Chancellor also announced in the Growth Plan that the basic rate of income tax would be reduced from 20% to 19% from 6 April 2023.  It is understood that this change will still be going ahead, as is the repeal of the Health and Social Care Levy.

It is not clear yet whether the Chancellor will also reverse the abolition of the additional dividend tax rate.  

The tax rates for Scottish and Welsh taxpayers will be set by the Scottish Parliament and Welsh Senedd respectively later in 2022.

The updated income tax rates for the 2023/24 U.K. tax year following the latest announcement are shown in the table below.


2023/24 tax year




Personal Allowance



Basic rate


£0 - £37,700

Higher rate


£37,701 - £150,000

Additional rate


Over £150,000

Source: KPMG LLP (U.K.)

The U.K. income tax rates and other measures announced in the Growth Plan will be legislated for in the next Finance Bill.  The timing of this has not been announced yet; however, it is expected that this will be enacted in Q1 2023.


It is essential to get in front of the changes described in this newsletter and to communicate quickly and clearly with key stakeholders, so that they can properly plan, budget, and make necessary adjustments.

KPMG LLP (U.K.) will endeavour to continue to keep readers informed of any further developments that concern individuals, including those on international assignments, and their multinational employers.


1  For the U.K.’s "Growth Plan 2022," see:

2  For coverage by KPMG LLP U.K. of the Autumn 2022 Growth Plan, see GMS Flash Alert 2022-172 (27 September 2022).

3  Kwarteng, K [@KwasiKwarteng]. (2022, 3 October). We get it, and we have listened [Tweet]. Twitter .

The information contained in this newsletter was submitted by the KPMG International member firm in the United Kingdom.


Connect with us

Stay up to date with what matters to you

Gain access to personalized content based on your interests by signing up today


GMS Flash Alert is a Global Mobility Services publication of the KPMG LLP Washington National Tax practice. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

© 2024 KPMG IFRG Limited is a UK company, limited by guarantee. All rights reserved. KPMG IFRG Limited, registered in England No 5253019. Registered office: 8 Salisbury Square, London, EC4Y 8BB