Information

Scottish Income Tax 2023-24: factsheet

A factsheet on the changes made to Scottish Income Tax for 2023 to 2024.

This document is part of a collection


Income Tax Policy Proposal: Scottish Budget 2023-24

  • Maintain the Starter and Basic Rate bands at the same level, in cash terms, as 2022-23.
  • No changes to the Starter, Basic and Intermediate Rates.
  • Maintain the Higher Rate threshold at the same level, in cash terms, as 2022-23.
  • Reduce the Top Rate threshold from £150,000 to £125,140.
  • Add 1 pence to the Higher and Top Rates of tax to 42 pence and 47 pence respectively.
  • The UK Government confirmed in the 2022 Autumn Statement that the UK-wide Personal Allowance will remain frozen at £12,570.
  • The Scottish Fiscal Commission have forecast that Income Tax will raise £15,810 million in 2023-24 in Scotland.

Proposed Income Tax Rates and Bands

2022-23 2023-24
Band Rate Band Rate
Starter £12,571* - £14,732 19% £12,571* - £14,732 19%
Basic £14,733 - £25,688 20% £14,733 - £25,688 20%
Intermediate £25,689 - £43,662

21%

£25,689 - £43,662 21%
Higher £43,663 - £150,000** 41% £43,663 - £125,140** 42%
Top Above £150,000 46% Above £125,140 47%

*Assumes individuals are in receipt of the standard Personal Allowance.

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

Expected number and proportion of Scottish taxpayers by marginal tax rate, 2023-24

Pie chart showing Scottish Share of Income Taxpayers and Liabilities by band in 2023-24

Impact on individual taxpayers of changes to Scottish Income Tax

  • 39% of Scottish adults (1.8 million individuals) are not affected by the 2023-24 policy changes as their income is below the UK-wide Personal Allowance.
  • The policy changes also have no effect on the lowest earning 9% of taxpayers (or 5% of adults) who earn less than £14,732 (and pay the 19p Starter Rate).
  • Those earning less than £27,850 – which is 52% of Scottish taxpayers (1.47 million people) - will continue to pay slightly less Income Tax in 2023-24 than if they lived elsewhere in the UK.

The table below compares the impact on take home pay for individuals earning different levels of income.[1] Three different comparisons are provided:

  • The second column sets out the impact of the proposed changes to Scottish Income Tax in 2023-24, compared to 2022-23, assuming no change in their income;
  • For example, a Scottish taxpayer earning £50,000 will see a £63 reduction in their take home pay in 2023-24 compared with 2022-23.
  • The third column sets out the difference in take home pay resulting from Scottish Income Tax policy compared to the rest of the UK in 2023-24.
  • The fourth column shows the impact on take home pay in 2023-24, compared to a baseline where all thresholds and bands are increased in line with inflation, bar the Top Rate Threshold which would be frozen at £150k. This provides a truer real terms measure of the changes that income taxpayers will experience in their income tax contributions.
Example income Impact on Take Home Pay
Impact of changes in 2023-24 compared to 2022-23 Position relative to the rest of the UK in 2023-24 Impact of changes in 2023-24 compared to inflationary uprating in 2023-24
£15,000 £0 £22 -£2
£17,000 £0 £22 -£2
£19,000 £0 £22 -£2
£20,000 £0 £22 -£2
£30,000 £0 -£22 -£15
£40,000 £0 -£122 -£15
£45,000 -£13 -£452 -£296
£50,000 -£63 -£1,552 -£961
£60,000 -£163 -£1,806 -£1,061
£100,000 -£563 -£2,606 -£1,461
£120,000 -£863 -£3,206 -£1,761
£150,000 -£2,432 -£3,858 -£3,330
£160,000 -£2,532 -£4,058 -£3,430

Contact

Email: ellis.reilly@gov.scot

Back to top