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1:00 AM 9th February 2024
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Hairdressers Hit By 100% Income Tax Increase

 
Photo by Adam Winger on Unsplash
Photo by Adam Winger on Unsplash
The latest analysis by finance company RIFT, reveals that hairdressers, beauticians, and cab drivers have been hit with the biggest income tax increases over the past year.

The company has analysed the estimated annual income tax paid across 25 of the nation’s most common professions, ranging from police officers to bus drivers, to see how each professional’s tax bill has changed over the past year, based on average salary data from ONS, and income tax guidelines from the UK government.

The research reveals that hairdressers have been hit with the biggest percentage tax increase of all professions over the past year.

Photo by Lexi Anderson on Unsplash
Photo by Lexi Anderson on Unsplash
In 2022, the average gross salary for a hairdresser or barber was £13,548, earnings on which they paid an estimated £311 for income tax and National Insurance (NI).

In 2023, the average salary for a hairdresser increased to £14,725, which resulted in tax and NI payments increasing to £645. This means hairdressers saw their income tax bill rise by 107.2% year on year.

Other professions to endure the biggest tax increases are beauticians (41.3%), taxi drivers (21.1%), florists (20.5%), dry cleaners (14.6%), chefs (14.1%), and bus drivers (13.2%).

When it comes to the largest pound and pence tax increases, no profession saw a bigger increase than solicitors and lawyers. While their annual tax bill increased by just 8.9%, this is equivalent to a hike of £1,397 over and above what they paid in tax in 2022.

A number of professions actually saw their income tax bills decrease on the year, none more so than fitness instructors.

In 2022, fitness instructors earned an average salary of £13,392, but a year later, this had dropped to £11,733 which brings their average income below the income tax threshold of £12,571. As such, their income tax bill fell by 100%.

Postal workers also endured a drop in salary between 2022-23, resulting in their tax bill falling by -12.4%, while police officers actually saw a slight salary increase but still saw their tax bill drop by -6%.

Other professions to pay less tax in 2023 than 2022 include doctors (-3.8%), nurses (-2.9%), clergy (-2.3%), plumbers (-1.8%), social workers (-1.1%), and accountants (-0.4%).

Bradley Post, MD of RIFT, commented:
“Nobody enjoys seeing their income tax increase, but even less so when a very minor pay rise results in a pretty hefty tax increase. For hairdressers, it must come as quite a shock to see a pay rise of less than 9% result in a tax increase of more than 100%, but such is the curious workings of income tax and NI calculations.

"If you’ve been hit with a tax increase, not least if it’s the result of changing jobs in the past year, we would strongly recommend you check to see if you are entitled to a tax rebate.

"People often mistakenly think that such refunds are only available to the self-employed, but that’s not the case. The possibility of a refund is there for anyone who pays income tax to HMRC. What’s more, refunds can be backdated up to four years.”


Data tables and sources can be viewed online, here.