Work out if you'll pay Scottish Income Tax
Guidance and examples on whether you'll be a Scottish taxpayer if you move to or from Scotland, have more than one home or have no home.
If you live in one place during a tax year, and it’s in Scotland you’ll be a Scottish taxpayer and will pay Scottish Income Tax from 6 April 2017. It’s paid to the Scottish Government.
Scottish Income Tax replaces the ‘Scottish rate of Income Tax’, which is chargeable on income from 6 April 2016 to 5 April 2017.
If you live anywhere else in the UK you won’t be a Scottish taxpayer.
Your situation might be different if you:
- move to or from Scotland during the year
- have more than one home at the same time
- have nowhere you can identify as your home
You can only be a Scottish taxpayer if you’re resident in the UK for tax purposes.
If you don’t live in Scotland
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
If you move to or from Scotland
If you move to or from Scotland in the course of a tax year you’ll be a Scottish taxpayer if you live in Scotland for at least as much of the tax year as you live in any other country in the UK.
From 6 April 2016 your tax code will start with an ‘S’ if you’re a Scottish taxpayer.
If you move to a new address you must tell HM Revenue and Customs (HMRC) so they can make sure you have the right tax code. Your employer can’t do this.
Example: you move to Scotland
You’ve rented and lived at a house in Birmingham for a number of years. On 30 June your rental on the Birmingham property ends and you immediately move to a flat in Aberdeen. The time you spent living in Scotland in the tax year (1 July to 5 April) was longer than the time you lived in England (6 April to 30 June) so you’re a Scottish taxpayer for the whole tax year.
Example: you move from Scotland
You’ve lived in Glasgow for many years. In the course of the tax year you sell your house in Glasgow and move into a flat in Manchester where you stay before moving to a new house in Bristol. During the tax year you spent:
125 days in Glasgow
120 days in Manchester
120 days in Bristol
You’re not a Scottish taxpayer for the whole of the tax year because you lived in Scotland for less time than you lived in England (Scotland 125 days, England 240 days).
If you have more than one home at the same time
Where you have more than one place you regard as home, one in Scotland and one elsewhere in the UK you need to know which is your main home, to decide if you’re a Scottish taxpayer.
What counts as your main home
Your main home is usually where you live and spend most of your time. It doesn’t matter whether you own it, rent it or live in it for free.
Your main home may be the home where you spend less time if that’s where:
- most of your possessions are
- your family lives, for example, if you’re married, in a civil partnership or a long-term relationship
- you’re registered for things like your bank account, GP or car insurance
- you’re a member of clubs or societies
Example 1: more than one home
You’re single and have lived in a flat in Carlisle for many years. You’re a member of various clubs and social groups in the city. However, you also own a house outside of Oban, where you like to go walking and fishing most weekends and for longer in the summer holidays. Both properties are furnished with your possessions but your doctors, dentist and opticians registration are all in Carlisle.
You’ve 2 places where you live that you could call your home but your main home is in Carlisle, as this is the place with which you have the closest connection, both in terms of social and functional links and in where you spend the most time. You’re not a Scottish taxpayer as your main home is in England.
Example 2: more than one home
You’ve a family home in Kilmarnock with your husband and children but work in Cardiff. To avoid the commute you rent a flat in Cardiff where you stay during the week and keep some of your possessions, returning to the family home in Kilmarnock each weekend. All the friends that you see socially live in or around Kilmarnock and you’re a member of various local sports and social groups in the town in addition to your doctor and dentist being in the town.
You’ve 2 places where you live during the year that could be looked at as your home. Despite spending more time in terms of days in Cardiff through the tax year, your main home is Kilmarnock because of the family, social and other links that you have there. You’re therefore a Scottish taxpayer for the whole tax year.
You can’t identify anywhere as your home
Your situation may be that either:
- there is nowhere during a tax year that you’ve stayed for regular periods that you would regard as your home
- you’ve more than one place that you live and it’s not possible to identify which is your main home
You must work out whether you’re a Scottish taxpayer or not by counting the number of days you spend in Scotland and comparing it to the number of days you spend elsewhere in the UK during a tax year.
If you spend more days in Scotland than elsewhere in the UK, you’re a Scottish taxpayer for the whole tax year.
Example: you have no home
You work for a consultancy firm advising on IT projects and travel round the UK on short term assignments, staying in hotels. You neither own nor rent your own property. In the course of the tax year you spend:
150 days in Scotland
100 days in England
90 days in Wales
25 days in Northern Ireland
You don’t have anywhere that could be regarded as your home during the course of the tax year so the days you spend in Scotland are compared against the days you spend elsewhere in the UK. As the 150 days you spent in Scotland are less than the 215 days you spent in another part of the UK, you’re not a Scottish taxpayer.
Example: you have several homes
You run a business with offices in different parts of the UK. You’ve bought homes in England, Scotland and Wales, so you can have a base near each of your offices. You travel for business and sometimes stay in hotels, but you usually base yourself at one of your homes, including the one in Scotland. You’re registered to vote at your home in England, but your bank accounts are registered at different addresses. You also have cars registered at each of your homes.
You can’t establish any one main home so you’ll need to count the days you spend in Scotland to work out whether you should pay the Scottish rate.
What counts as a day
Where you spent a day depends on where you were at midnight at the end of the day. For example, if you lived in Scotland from 10am on Monday to 5pm on Friday the same week, you spent 4 days there.
If you work offshore, you have spent a day in Scotland if you’re up to 12 nautical miles from Scotland.
Travel through the UK
You might be in ‘transit’ through the UK. This means on the way from one country outside the UK to another outside the UK. It doesn’t count as a day, even if you’re in the UK at midnight, unless you:
- don’t leave the UK the next day
- carry out activities not connected with travel, for example, you visit friends, or go to a work meeting
Go to detailed technical guidance about who is a Scottish taxpayer.
The Scotland Act 2012 contains the full definition of a Scottish taxpayer.
If you need further help or guidance contact HMRC.