Scottish Income Tax

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Discussion

telecat

Original Poster:

8,528 posts

240 months

Thursday 30th November 2017
quotequote all
Any body know if the Scottish Income tax regime is that different to the UK? My Son is living up there at the moment but is being told that they are paying a higher rate and isn't keen on the idea.

ferrariF50lover

1,834 posts

225 months

Thursday 30th November 2017
quotequote all
Is Scotland different from the United Kingdom of Great Britain and Northern Ireland?

Do you mean is Scotland different from England?

Either way, I Googled it for you:

https://www.gov.uk/scottish-rate-income-tax

mcbook

1,384 posts

174 months

Thursday 30th November 2017
quotequote all
The higher rate kicks in sooner in Scotland (£43k vs £45k). The increase in the threshold that happened in England at the last budget wasn't matched in Scotland.

A couple of free prescriptions and he'll make the difference back :-)

However, there is a further reaching review of income tax in Scotland going on at the moment. I don't think there will be any changes quickly but the direction of travel is definitely towards higher taxation in Scotland.

I'm happy with that so long as it seems like value. For example: free prescriptions, university, childcare (plans to make more generous).

Edited by mcbook on Thursday 30th November 16:54

Orchid1

877 posts

107 months

Thursday 30th November 2017
quotequote all
Rumours abound that they want to raise the basic rate for anyone earning over £24k. They've been told by multiple people that this would be disastrous however when have they ever listened before?

Therefore prepare for brain drain from Scotland.

mcbook

1,384 posts

174 months

Thursday 30th November 2017
quotequote all
Coming back with the actual numbers (PAYE)...

If you earn over £45k it will cost you £400 more in tax p.a. to live in Scotland than it does to live in England

If you earn less than £43k it will cost the same

If you earn between £43k and £45k... work it out yourself.

The Scottish Gov was actually quite canny with this one. However, the real issue will come when they want to actually raise rates and there becomes a really obvious gap between the basic rates (Eng v Scotland) or even different rates entirely.

Eric Mc

121,779 posts

264 months

Thursday 30th November 2017
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Simple answer is, yes, the Scottish Income Tax regime is different to that in place in the other countries of the UK (England, Wales and Northern Ireland). And the differences as outlined above are set to become more common as the years go by. Scotland now has its own revenue apparatus (Revenue Scotland) and his increasing powers over its own taxation system.

telecat

Original Poster:

8,528 posts

240 months

Friday 1st December 2017
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Many Thanks! Does not look like he'll be staying if they increase it too much!

mickthemechanic

326 posts

105 months

Friday 1st December 2017
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Hi s there are some tax brains in here I have a question. I work in Scotland but payroll and headquarters of company are in England so which tax rules am I under? Thanks

LC23

1,285 posts

224 months

Friday 1st December 2017
quotequote all
https://www.gov.uk/government/publications/scottis...

Live in Scotland. Almost certainly a Scottish tax payer. HMRC are meant to decide and issue the appropriate PAYE code.

mickthemechanic

326 posts

105 months

Friday 1st December 2017
quotequote all
Hi no live in England but work in Scotland.

Eric Mc

121,779 posts

264 months

Friday 1st December 2017
quotequote all
mickthemechanic said:
Hi s there are some tax brains in here I have a question. I work in Scotland but payroll and headquarters of company are in England so which tax rules am I under? Thanks
Your tax residency will be where you spend your nights and/or where you have your home. It sounds like it is England which means that English tax rates apply. However, your tax residency status depends on a number of factors.

For example, if you "lived" in England (family and home in England) but spent most of the tax year working in Scotland staying in B & Bs, for instance, you might end up being a Scottish tax resident.

This is going to be a thorny issue for employers on both sides of the border.

For Income Tax purposes, England and Scotland are now separate countries.

LC23

1,285 posts

224 months

Saturday 2nd December 2017
quotequote all
https://www.gov.uk/guidance/work-out-if-youll-pay-...

If you live outside of Scotland you’ll not be a Scottish taxpayer and none of the following will make you a Scottish taxpayer:

national identity - you regard yourself as being Scottish
location of work - you work in Scotland
you receive a salary or pension from a Scottish employer or pension provider
you travel in Scotland - for example, driving a lorry in, or frequent work visits to Scotland

There is a fair amount of guidance on this and as Eric has quite rightly said, some cases will not be straight forward. Broadly however if your family (only) home is not in Scotland then you will not be a Scottish taxpayer. This is especially true if you just travel over the border each day to work.

Eric Mc

121,779 posts

264 months

Saturday 2nd December 2017
quotequote all
I think the contentious issues will centre around workers who stay away from home during the week and live in digs near their place of work.

Dicky Knee

1,026 posts

130 months

Monday 4th December 2017
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My brother works on a gas rig in the North Sea. He hasn't mentioned any change in his tax. He doesn't really have the option of nipping over the border to sleep either. I'll ask him when he is next home (England).

Eric Mc

121,779 posts

264 months

Monday 4th December 2017
quotequote all
Dicky Knee said:
My brother works on a gas rig in the North Sea. He hasn't mentioned any change in his tax. He doesn't really have the option of nipping over the border to sleep either. I'll ask him when he is next home (England).
There are special rules for oil rig workers.

telford_mike

1,219 posts

184 months

Thursday 14th December 2017
quotequote all
Orchid1 said:
Rumours abound that they want to raise the basic rate for anyone earning over £24k. They've been told by multiple people that this would be disastrous however when have they ever listened before?

Therefore prepare for brain drain from Scotland.
It happened.

http://www.bbc.com/news/uk-scotland-42356953

Orchid1

877 posts

107 months

Thursday 14th December 2017
quotequote all
telford_mike said:
Of course it happened, the SNP have absolutely no clue. Social media is already crawling with SNP supporters saying it's worth it for free prescriptions and university and that they won't be going anywhere.

They seem to forget of course that now school leavers in Scotland will look to go to uni then leave down south to England when they graduate where they have higher wages, more jobs and now less taxes.

Let the brain drain commence!

mcbook

1,384 posts

174 months

Thursday 14th December 2017
quotequote all
Orchid1 said:
Of course it happened, the SNP have absolutely no clue. Social media is already crawling with SNP supporters saying it's worth it for free prescriptions and university and that they won't be going anywhere.

They seem to forget of course that now school leavers in Scotland will look to go to uni then leave down south to England when they graduate where they have higher wages, more jobs and now less taxes.

Let the brain drain commence!
I'm happy enough with the tax increases.

The reality is that with the increase in the higher rate threshold from £43,000 to £44,275 and the increase in Personal Allowance, I'll actually pay very slightly less tax after the changes than I do now!

What I don't like is the added complexity.


sas62

5,624 posts

77 months

Thursday 14th December 2017
quotequote all
I recall a number of occasions when national trade unions vetoed the idea of regional pay in the public sector (apart from London weighting) on the grounds that if you're doing the same job then its the same pay - regardless of the local cost of living.

Doesn't this tax change effectively introduce a disparity that you'd expect the unions to be all over ? I could imagine them pushing for higher pubic sector gross salaries in Scotland as a result.

Or don't the unions represent anyone earning mid 30k.

Mind you if they don't argue against it that could mean that they can no longer argue against regional pay agreements in the public sector.

Its a fair few years since my Civil Service days so maybe things have moved on.

mcbook

1,384 posts

174 months

Thursday 14th December 2017
quotequote all
sas62 said:
I recall a number of occasions when national trade unions vetoed the idea of regional pay in the public sector (apart from London weighting) on the grounds that if you're doing the same job then its the same pay - regardless of the local cost of living.

Doesn't this tax change effectively introduce a disparity that you'd expect the unions to be all over ? I could imagine them pushing for higher pubic sector gross salaries in Scotland as a result.

Or don't the unions represent anyone earning mid 30k.

Mind you if they don't argue against it that could mean that they can no longer argue against regional pay agreements in the public sector.

Its a fair few years since my Civil Service days so maybe things have moved on.
The budget has also announced pretty decent increases in public sector pay. I haven't done the calcs but I'd be surprised if they net result was lower net pay.