On 15 December 2022, Deputy First Minister, John Swinney, announced several tax changes for Scottish taxpayers and those acquiring property located in Scotland, with the aim of raising £1 billion more than would have been generated had the measures announced by the UK Government in the November’s autumn statement been followed.
For the 2023/2024 tax year:-
- The higher rate of income tax (applicable to earnings between £43,663 and £125,140) will increase from 41% to 42%;
- The additional rate of income tax (applicable to earnings above £125,140) will increase from 46% to 47%;
As a result of the above and the differences, compared to the rest of the UK, between the bands at which income tax and national insurance change, a Scottish taxpayer earning £50,000 gross will pay £14,682.68 in income tax and national insurance – £1,552.48 more than the amount paid by their English counterpart.
On Land and Buildings Transaction Tax (LBTT), the Additional Dwelling Supplement, which applies on top of normal LBTT rates to people buying a second home in Scotland (or to any Scottish house bought by a non-individual), is increased from 4% to 6% from 16 December 2022.
In addition, Swinney announced that non-domestic basic property rates are frozen for 2023/2024 and Scottish Landfill Tax rates will be increased, in line with similar measures announced by the UK Government.
| Current Thresholds | New Threshold (Effective 6 April 2023) | Tax Rate | |
|---|---|---|---|
| Personal Allowance | Up to £12,570 (SCO) | No Change Frozen until 2028 | 0% (No change) |
| Up to £12,570 (ENG) | No Change Frozen until 2028 | 0% (No change) | |
| Starter Rate | £12,571 to £14,732 (SCO) | No Change | 19% (No change) |
| Basic Rate | £12,571 to £14,732 (SCO) | No Change | 20% (No change) |
| £12,571 to £50,270 (ENG) | No Change Frozen until 2028 | 20% (No change) | |
| Intermediate Rate | £25,689 to £43,662 (SCO) | No Change | 21% (No change) |
| Higher Rate | £43,663 to £150,000 (SCO) | £43,663 to £125,140 | 42% (+1%) |
| £50,271 to £150,000 (ENG) | £50,271 to £125,140 | 40% (No change) | |
| Top/Additional Rate | over £150,000 | Over £125,140 | 47% (+1%) |
| over £150,000 | Over £125,140 | 45% (No change) |
| Scotland | Rest of the UK | |
|---|---|---|
| £25,000 | £2,464 | £2,486 |
| £50,000 | £9,038 | £7,486 |
| £100,000 | £30,038 | £27,432 |
| £150,000 | £57,560 | £53,703 |
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