Scotland has six income tax bands for 2026/27 (6 April 2026 to 5 April 2027), compared with three in the rest of the UK. After the UK-wide £12,570 personal allowance, Scottish taxpayers pay 19% (starter), 20% (basic), 21% (intermediate), 42% (higher, from £43,663), 45% (advanced, from £75,001) and 48% (top, over £125,140). The Scottish rates apply to earnings, pensions, self-employed profits and rental income. Savings interest and dividends are taxed at UK rates.
Scottish income tax bands 2026/27
| Band | Taxable income | Rate |
|---|---|---|
| Personal allowance | Up to £12,570 | 0% |
| Starter rate | £12,571 to £16,537 | 19% |
| Basic rate | £16,538 to £29,526 | 20% |
| Intermediate rate | £29,527 to £43,662 | 21% |
| Higher rate | £43,663 to £75,000 | 42% |
| Advanced rate | £75,001 to £125,140 | 45% |
| Top rate | Over £125,140 | 48% |
The table assumes the standard personal allowance. Payroll software shows the same bands as slices of income above the allowance. The starter rate, for example, covers the first £3,967 of taxable pay. The rates were set out in the Scottish Budget on 13 January 2026 and are in force for 2026/27, as shown on GOV.UK.
What changed from 2025/26. The rates are the same. The starter and basic band ceilings rose: the starter band now ends at £16,537 (was £15,397), and the basic band ends at £29,526 (was £27,491). The intermediate rate starts at £29,527 (was £27,492). The higher, advanced and top rate thresholds did not change.
How Scottish tax compares with the rest of the UK
The rest of the UK has one 20% band up to £50,270, then 40% and 45%. In Scotland the starter rate gives a small saving at the bottom, the 21% and 42% rates add cost further up, and the 42% rate starts about £6,600 lower than the UK higher rate.
Worked illustrations for earned income with the standard allowance (not official figures):
- £30,000. £3,451.07 in Scotland against £3,486 in England;
- £33,500. About the same either side of the border, around £4,186;
- £60,000. £13,182.05 in Scotland against £11,432 in England.
National Insurance is UK-wide and ignores the Scottish bands. Employees pay 8% up to £50,270 and 2% above. On the slice between £43,663 and £50,270, a Scottish employee therefore pays 42% income tax plus 8% National Insurance, a combined marginal rate of 50%.
The personal allowance taper also applies in Scotland. Above £100,000 of adjusted net income, the allowance falls by £1 for every £2. In that range the marginal band is the 45% advanced rate, so the effective rate is 67.5% before National Insurance, against 60% elsewhere. See our guide to the £100k tax trap.
Who pays Scottish income tax?
The test is where you live, not where you work or where your employer is based. Under section 80D of the Scotland Act 1998, you are a Scottish taxpayer for a tax year if you are UK resident and one of these applies:
- Close connection. Your main home is in Scotland;
- Day count. You have no close connection with any other part of the UK and spend more days in Scotland than elsewhere in the UK. A day counts where you are at midnight;
- Parliamentarians. You are a Scottish MP or a member of the Scottish Parliament.
If you have homes both in and outside Scotland, your main home is usually the one where you live and spend most of your time. It can be the other home if that is where your possessions are, where your family lives, where you are registered with a GP or bank, or where your clubs are. Someone living in Carlisle and working in Glasgow is not a Scottish taxpayer. Someone living in Edinburgh and working in London is.
Moving. Scottish status applies to the whole tax year. If you move to Scotland and live there longer than anywhere else in the UK during the year, you are a Scottish taxpayer for the full year. HMRC backdates the change to 6 April and adjusts your PAYE for the rest of the year. Tell HMRC about your new address promptly. Otherwise you will pay at the wrong rates.
Self-employed people and landlords. Sole trader profits and rental profits are non-savings income, so the Scottish bands apply to them through Self Assessment. Class 4 National Insurance is still charged at UK rates: 6% on profits between £12,570 and £50,270 and 2% above. A Scottish sole trader with profits in the £43,663 to £50,270 slice therefore pays 42% plus 6% on it, a combined 48%.
Your tax code, Self Assessment and pensions
- Tax code. Scottish taxpayers have codes starting with S. The standard code is S1257L. If yours lacks the S and you live in Scotland, or has an S and you don't, contact HMRC;
- Self Assessment. The online return has a box to say you are a Scottish taxpayer;
- Pension relief at source. Providers add 20% relief (see relief at source vs net pay). Starter rate taxpayers keep the full 20% even though they pay 19%. Intermediate, higher, advanced and top rate taxpayers can claim a further 1%, 22%, 25% or 28% through Self Assessment, depending on the rate their income is taxed at.
Savings, dividends and property income
Scottish rates apply only to non-savings, non-dividend income. Interest is taxed at UK savings rates and dividends at UK dividend rates (10.75%, 35.75% and 39.35% for 2026/27). Both use the UK band structure. Finance Act 2026 has also given the Scottish Parliament power, from 2027/28, to set separate rates for property income. Landlords should watch the next Scottish Budget.
For the UK-wide picture, see what income tax is and how it works and the 40% tax bracket. Acumon's private client tax team advises Scottish taxpayers and people who split their time across the border, including on residence status. Our income tax return service makes sure the extra pension relief is claimed on your return.