Coding: coding: general principles: Scottish rate of income tax
The Scotland Act 2012 gives the the Scottish Government the powers to set a Scottish rate of Income Tax which is administered by HM Revenue & Customs (HMRC) for Scottish taxpayers. The introduction of the Scottish rate of income tax from 6 April 2016 will enable the Scottish Government to set the rates of income tax lower or higher than the rates that apply in the rest of the United Kingdom (England, Wales and Northern Ireland). If they set a different rate it will apply to all income tax rates, the basic rate, the higher rate and the additional rate will go up or down by the same percentage, relative to the UK rate.
The total rate for Scottish taxpayers is the amount of income tax Scottish taxpayers will have to pay on their non-savings and non-dividend income. Savings and dividend income is still taxed using the United Kingdom (England, Wales and Northern Ireland) regardless of the individual’s residency status.
The Scottish rate of income tax will apply where someone who is resident in the United Kingdom (UK) for tax purposes and who has their sole or main place of residence in Scotland for more of the tax year than any other part of the UK.
Where an individual is identified as a ‘Scottish Taxpayer’ their tax code will include an S prefix e.g. S1100L, SBR, S0T. Tax code NT is still used for both United Kingdom (England, Wales and Northern Ireland) and Scottish taxpayers and will not include the S prefix.
Further information on the Scottish rater of Income Tax is given at PAYE100035