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Saturday, May 18, 2024

Income Tax Changes

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People urged to check their tax code as new financial year begins.

Progressive changes to Scottish income tax will raise valuable revenue for investing in public services, Deputy First Minister Shona Robison has said.  

From Saturday (6 April 2024) a new Advanced income tax band will apply a 45% rate on annual income between £75,000 and £125,140.

An additional 1pence will be added to the Top rate of tax meaning income over £125,140 will be taxed at 48%.

There are no changes to the Starter, Basic, Intermediate and Higher tax rates for earnings under £75,000. The Starter and Basic rate bands will increase in line with inflation and the Higher rate threshold will be maintained at £43,662.

The independent Scottish Fiscal Commission estimates that overall income tax will raise £18.8 billion in 2024-25.

Scottish taxpayers are being encouraged to check to ensure the tax code on their first payslip in the new financial year is accurate.

People paying Scottish income tax should have a tax code that begins with an S.

Deputy First Minister Shona Robison said:

“Scotland has the most progressive income tax system in the UK.

“The new Advanced band builds on that progressive approach, protecting those who earn less and asking those who earn more to contribute more.

“Only 5% of Scottish taxpayers will pay a higher tax rate this year compared to last year and the majority of taxpayers are still paying less than they would elsewhere in the UK.

“The money raised through income tax allows people in Scotland to benefit from a wide range of services and social security payments not provided elsewhere in the UK, including free prescriptions and free higher education.

“Council tax is less in Scotland than in England, even before factoring in a council tax freeze for 2024-25.

“I encourage everyone to check their first payslip in April to make sure their address is correct and that their tax code starts with an ‘S’.

“This will ensure that people are paying the right amount of tax on their income.”

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