Press Release: Charity offers guidance for taxpayers as Scotland sets income tax rate for first time

Published on 18 December 2015

The Scottish Government has today delivered its budget in which it had the power to set an income tax rate for the first time. The Low Incomes Tax Reform Group (LITRG) is calling for a more concerted effort to publicise the new powers and to ensure that Scottish taxpayers know their status. The Group has also published guidance on its website to assist taxpayers.  

The Scottish Government now has the power to set a Scottish rate of income tax which affects the overall rate Scottish taxpayers will pay. Finance Minister, John Swinney, has confirmed that the Scottish rate of Income Tax (SRIT) will be 10%, meaning the overall income tax rate will remain at the same level as in the rest of the UK.

Anthony Thomas, Chair of the LITRG, commented:

“This represents a significant step in the devolution of fiscal power to Scotland; given its significance we are concerned by low levels of public awareness.

“Earlier in the week, we drew attention to our concerns over the issuing of millions of letters to Scottish taxpayers informing them about the rate-setting powers and to check their addresses. A helpline number was omitted from these letters, cutting off, particularly for the elderly amongst others, a vital line of communication, on the assumption that all recipients would be sufficiently competent with computer communication not to need one.

“The Revenue must ensure that this short-sightedness does not hamper its campaign to enlighten Scots on their government’s new rate-setting powers from April 2016.

“We now know that the SRIT rate for 2016/17 will be 10%; this means that Scottish taxpayers will pay income tax at the following rates on their non-savings and non-dividend income:

  • Scottish basic rate of 20%;
  • Scottish higher rate of 40%; and
  • Scottish additional rate of 45%

“For Further information on how the SRIT rate works, who is affected, how it is collected and its various other effects, including on pension contributions, please see here.” 

(16-12-2015)

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