Are you or any of your employees Scottish Taxpayers?

Are you or any of your employees Scottish Taxpayers?  If so, you need to be aware that if new rules are passed, from 6 April 2018, there will be five separate rates of Income Tax in Scotland.  You should therefore ensure your payroll software is up to date and will include these changes.

A summary can be found at the following link https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2018-to-2019

Scottish income tax is only payable by Scottish taxpayers.  HMRC will determine whether or not you are a Scottish taxpayer based on where your main place of residence is.

It is said that as a result of these changes and the increase in the Personal Allowance, anyone with income up to £33,000 will be protected from these increases, whilst above that amount, most taxpayers should only pay a proportionate amount more.

Interestingly, because the rates will be higher than in the rest of the UK, there will also be the opportunity for some Scottish Taxpayers to obtain additional tax relief for their pension contributions, though it may then be necessary to prepare an annual tax return.

If you have any queries or wish to discuss the impact on your tax affairs please don't hesitate to get in touch with us.