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From 6 January 2024, the main rate of class 1 National Insurance contributions (NIC) deducted from employees’ wages is reduced from 12% to 10%. From 6 April 2024, the main rate of self-employed class 4 NIC will reduce from 9% to 8% and class 2 NIC will no longer be due. Those with profits below £6,725 a year can continue to pay class 2 NIC to keep their entitlement to certain state benefits. Our guidance will be updated in full in spring 2024.

Updated on 6 April 2023

Scottish income tax

Scottish taxpayers pay Scottish income tax and have done so since 6 April 2017.

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Scottish income tax

Scottish income tax is not a separate tax, nor is it a devolved tax as such.

Instead, the Scottish parliament has the power to affect the amount of income tax that Scottish taxpayers pay. To do this, the Scottish parliament sets Scottish rates and bands (of income tax), which determine the rates of income tax payable by Scottish taxpayers on certain types of income.

Broadly, Scottish income tax is payable by Scottish taxpayers on their non-savings and non-dividend income.

If Scottish taxpayers have taxable savings income, such as bank interest, or taxable dividend income, this is subject to the main UK rates of income tax for those types of income.

Scottish income tax does not affect the tax allowances to which you are entitled, such as the personal allowance. We explain how it affects the marriage allowance on our page Scottish income tax: more detail.

The amount of income tax you pay on non-savings and non-dividend income according to the Scottish income tax rates and bands goes to the Scottish government; any income tax you pay on savings or dividend income according to the UK rates and bands goes to the UK government.

Scottish income tax administration and appeals

HMRC administer and collect Scottish income tax, using the Pay As You Earn (PAYE), simple assessment and self assessment systems.

This means that if you disagree with a decision concerning Scottish income tax, you must follow the HMRC appeal process. In addition, if you are unhappy with the service provided, you must follow HMRC’s complaints process.

Scottish income tax rates and bands

Scottish income tax has applied since 6 April 2017. For 2023/24, the rates and bands of Scottish income tax are as set out in the table below:

Name of band Band (£) Rate of Scottish income tax
Starter 12,571* to 14,732 19%
Basic 14,733* to 25,688 20%
Intermediate 25,689* to 43,662 21%
Higher 43,663* to 125,140 42%
Top Over 125,140 47%

* This assumes that you are entitled to the standard UK personal allowance. The starter, basic and intermediate rate bands together for Scottish income tax are £31,092 (£12,570 + £31,092 = £43,662).

The rates and bands of Scottish income tax for 2022/23 were as set out in this table:

Name of band Band (£) Rate of Scottish income tax
Starter 12,571* to 14,732 19%
Basic 14,733* to 25,688 20%
Intermediate 25,689* to 43,662 21%
Higher 43,663* to 150,000 41%
Top Over 150,000 46%

* This assumes that you were entitled to the standard UK personal allowance for 2022/23. The starter, basic and intermediate rate bands together for Scottish income tax in 2022/23 were £31,092 (£12,570 + £31,092 = £43,662).

Scottish income tax and the armed forces

While Scottish income tax applies to the income of armed forces personnel who are Scottish taxpayers in the first instance, they receive a retrospective payment after the end of the tax year to ensure they pay no more income tax than other UK personnel. You can read about this on GOV.UK.

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