The Scottish Budget has set the tax rates and bands for Scottish taxpayers for the 2023/2024 tax year.
The devolved tax rules allow the Scottish Parliament to vary its own tax rates and bands for non-savings income.
This allows people in Scotland earning less than £27,850 (over 50% of the tax base) to pay marginally less in income taxes than in the rest of the UK.
Below are the new Scottish bands and rates for 2023/2024 (these figures are post-tax allowances):
| Tax Band | Tax Rate | |
|---|---|---|
| Starter | £0-£2,162 | 19% |
| Basic | £2,163-£13,118 | 20% |
| Intermediate | £13,119-£31,092 | 21% |
| Higher | £31,093-£125,140 | 42% |
| Top | Over £125,140 | 47% |
... and these are the bands/rates with tax allowances added:
| Tax Band | Tax Rate | |
|---|---|---|
| Starter | £12,571-£14,732 | 19% |
| Basic | £14,733-£25,688 | 20% |
| Intermediate | £25,689-£43,662 | 21% |
| Higher | £43,663-£125,140 | 42% |
| Top | Over £125,140 | 47% |
Deputy First Minister John Swinney has opted to retain the same starter, basic and intermediate bands as last year but has focused changes at the upper pay scale. Changes that align Scottish taxes closer to the recent UK changes.
The top rate threshold has been lowered to match the UK but the tax percentages for both Scottish higher and top taxpayers has been hiked - both by a percentage point.
Higher rate Scottish taxpayers will pay 42 percent and Top taxpayers will pay 47 percent next year.
The changes are are thought to help Scotland raise nearly £16 billion from income tax in the next fiscal year.
The new tax rules will affect 497,000 higher rate taxpayers in Scotland and 33,000 on the top rate.
Nearly 40% of Scottish adults will see no changes to the amount deducted from their pay packets from these changes.
We have updated our wide range of tax calculators to reflect these new changes for next year - just select the 2023/2024 tax year and make sure your tax region is set as SCT.
Here is a quick reference table of how Scottish take home pay after tax compares to the rest of the UK.
| Gross income | Relative Take Home Pay Differences | ||
|---|---|---|---|
| Changes in 2023/24 compared to 2022/23 | Scotland vs Rest of the UK in 2023/24 | Inflation adjusted changes 2022 vs 2023 | |
| £15,000 | £0 | £22 | -£2 |
| £17,000 | £0 | £22 | -£2 |
| £19,000 | £0 | £22 | -£2 |
| £20,000 | £0 | £22 | -£2 |
| £30,000 | £0 | -£22 | -£15 |
| £40,000 | £0 | -£122 | -£15 |
| £45,000 | -£13 | -£452 | -£296 |
| £50,000 | -£63 | -£1,552 | -£961 |
| £60,000 | -£163 | -£1,806 | -£1,061 |
| £100,000 | -£563 | -£2,606 | -£1,461 |
| £120,000 | -£863 | -£3,206 | -£1,761 |
| £150,000 | -£2,432 | -£3,858 | -£3,330 |
| £160,000 | -£2,532 | -£4,058 | -£3,430 |