Publication - Factsheet

Scottish Income Tax: 2021-2022

Published: 28 Jan 2021

Rates and bands for Scottish Income Tax in the financial year 2021 to 2022.

Published:
28 Jan 2021
Scottish Income Tax: 2021-2022

The Scotland Act 2016 provides the Scottish Parliament with the power to set all income tax rates and bands that will apply to Scottish taxpayers' Non-Savings, Non-Dividend (NSND) income for the tax year 2021 to 2022. This excludes setting the Personal Allowance, which remains reserved, and is set by the UK Government in the UK Budget. Therefore, Scottish Income Tax remains part of the existing UK Income Tax system and is not a fully devolved tax.

How Scottish Income Tax works

The Income Tax rates and bands payable by Scottish taxpayers will be those set by the Scottish Parliament. Receipts from Scottish Income Tax will be collected by HMRC and paid to the Scottish Government (via HM Treasury).

Scottish rates and bands for 2021 to 2022

At the Scottish Budget on 28 January 2021, the Cabinet Secretary for Finance set out the proposed Income Tax rates and bands for 2021 to 2022. These proposals are subject to the agreement of a Scottish Rate Resolution due to be debated by the Scottish Parliament on 25 February 2021. If agreed to by Parliament, these rates and bands will be operative from 6 April 2021. 

The rates and bands in the table below are based on the UK Personal Allowance in 2021 to 2022 increasing in line with inflation, to £12,570.  This is following the commitment set out by the UK Government at the Spending Review in November 2020.

Bands

Band name

Rate

Over £12,570* - £14,667

Starter Rate

19%

Over £14,667 - £25,296

Scottish Basic Rate

20%

Over £25,296 - £43,662

Intermediate Rate

21%

Over £43,662 - £150,000**

Higher Rate

41%

Over £150,000**

Top Rate

46%

* assumes individuals are in receipt of the Standard UK Personal Allowance.

** those earning more than £100,000 will see their Personal Allowance reduced by £1 for every £2 earned over £100,000.

More information

The attached documents include:

  • a note on the distributional impact of the Scottish Government’s Income Tax policy choices over this Parliament (2016-17 to 2021-22)
  • a factsheet on the changes made to Scottish Income Tax for 2021 to 2022
  • an explanatory note on the Scottish Rate Resolution