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Tax Rates & Allowances

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Income Tax Rates and Bands

Recent income tax rates and bands are as follows:

2015/16 2016/17 2017/18
Savings rate: 10%, 0% from 2015/16 Up to £5,000 Up to £5,000 Up to £5,000
Dividend Allowance: 20% N/A Up to £5,000 Up to £5,000
Basic rate: 20% Up to £31,785 Up to £32,000 Up to £33,500
Higher rate: 40% £31,786 - £150,000 £32,001 - £150,000 £33,501 - £150,000
Additional rate: 45% Over £150,000 Over £150,000 Over £150,000

Autumn 2017 Budget announced the following income tax rates and bands for 2018/19:

2018/19
Savings rate: 0% 0 - £5,000
Dividend Allowance: 20% £2,000
Basic rate: 20% 0 - £34,500
Higher rate: 40% £34,501 - £150,000
Additional rate: 45% Over £150,000

When the personal allowance is taken into account an individual will start to pay tax at 40% when their total income exceeds £45,000 in 2017/18. This is expected to rise to £46,350 for 2018/19. This threshold (and the 45% threshold) can be increased if the taxpayer pays personal pension contributions or makes gift aid donations.

For 2017/18 the basic rate band on non-savings income for Scottish Taxpayers is set at £43,000. For all other income types it remains in line with the main UK band of £45,000.

Scottish Income Tax Rates and Bands for non-savings income

2018/19
Starter rate: 19% Up to £2,000
Basic rate: 20% £2,001 to £12,150
Intermediate rate: 21% £12,151 to £32,423
Higher rate: 41% £32,424 - £150,000
Additional rate: 46% Over £150,000
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