Scotland freezes income tax rates in Budget

10th December 2021

The rates of income tax in Scotland will remain frozen for the 2022/23 tax year.

The measure was annouced by Financial Secretary Kate Forbes, who delivered her Scottish Budget to Holyrood on 9 December 2021.

The higher and top rates will remain frozen at their current levels, while the starter and basic rates will increase with inflation.

That means, from 6 April 2022, taxpayers in Scotland will pay income tax of:

  • 19% on earnings between £12,571 to £14,667
  • 20% between £14,668 to £25,296
  • 21% on the chunk between £25,297 to £43,662
  • 41% on income between £43,663 to £150,000
  • 46% on earnings above £150,000.

Forbes said:

"The majority of Scottish taxpayers will continue to pay less income tax than if they lived elsewhere in the UK, while those who earn more will pay more."

Eligible retail, hospitality and leisure businesses, currently enjoying 100% uncapped relief on non-domestic rates, will see their discount reduced to 50% for the first three months of 2022/23, capped at £27,500 per ratepayer.

Small businesses worth less than £15,000 will continue to pay no rates for the entirety of next year, irrespective of the sector they are in through the small business bonus scheme.

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