Scottish Budget

Minister for Public Finance and Digital Economy, Kate Forbes, delivered the 2020/21 Scottish Draft Budget on Thursday 6 February 2020, setting out the Scottish Government’s financial and tax plans.

The current Scottish income tax rates and bands for 2019/20 and the proposed rates and bands for 2020/21 on non-savings and non-dividend income are as follows:

Scottish Bands 2019/20Scottish Bands 2020/21Band nameRate
£12,501* – £14,549£12,501* – £14,585Starter19%
£14,550 – £24,944£14,586 – £25,158Scottish Basic20%
£24,945 – £43,430£25,159 – £43,430Intermediate21%
£43,431 – £150,000**£43,431 – £150,000**Higher41%
Above £150,000**Above £150,000**Top46%

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

** the personal allowance will be reduced if an individual’s adjusted net income is above £100,000. The allowance is reduced by £1 for every £2 of income over £100,000.

In the 2018 Autumn Budget, the UK Government announced that the UK-wide personal allowance would be frozen at its current level of £12,500 in 2020/21. The UK higher rate tax point for 2020/21 is also expected to be frozen at the 2019/20 amount of £50,000 (for those entitled to the full UK personal allowance) and the tax rates for non-savings and non-dividend income are expected to be maintained at 20%, 40% and 45% respectively. The additional rate of 45% is payable on income over £150,000.

Land and Buildings Transaction Tax change to non-residential rates and bands

The Government announced the introduction of a new 2% band for non-residential leases which will come into effect for contracts entered into on or after 7 February 2020. The rates and bands for non-residential LBTT transactions are as follows:

Non-residential transactions (purchase price)RateNon-residential leases (net present value of rent payable)Rate
Up to £150,0000%Up to £150,0000%
£150,001 to £250,0001%£150,001 to £2 million1%
Over £250,0005%Over £2 million2%

Internet link: GOV.SCOT Budget