Scotland vs England Income Tax 2025/26: Who Pays More?

Quick answer

For the 2025/26 tax year, Scottish and English income tax behave differently:

(NI excluded — same UK-wide. Numbers rounded to nearest pound.)

The cross-over point is around £36,000–£40,000 — below that, most workers do equal or slightly better in Scotland; above that, English workers pay less.

The bands compared

England, Wales and Northern Ireland — 3 bands

(Plus PA tapering on income £100,000–£125,140.)

Scotland — 6 bands

Why Scotland looks different

Scotland gained partial income tax powers in 2017. Since then, every Scottish Budget has added more progressivity:

• Lower starter rate (19%) on a small slice — symbolic benefit for the lowest earners.
• Intermediate rate (21%) introduced to relieve the £27k–£43k band.
• Higher rate kicks in at £43,663 rather than England's £50,270.
• Advanced rate (45%) introduced 2024 between £75k and £125k.
• Top rate raised from 47% to 48% in April 2024.

The political effect: Scottish taxpayers under ~£27k pay marginally less than English peers; everyone above £43k pays substantially more.

Worked examples in detail

Sarah, £30,000 in Glasgow (Scotland) vs Bristol (England)

Scotland:

• PA £12,570: £0
• Starter rate 19% on £2,827 = £537
• Basic rate 20% on £12,094 = £2,419
• Intermediate rate 21% on £2,509 = £527
• Total: £3,483

England:

• PA £12,570: £0
• Basic rate 20% on £17,430 = £3,486
• Total: £3,486

Sarah pays £3 less in Scotland. Trivially small but Scotland-positive.

Mark, £55,000 in Edinburgh (Scotland) vs London (England)

Scotland:

• PA £12,570: £0
• Starter 19% × £2,827 = £537
• Basic 20% × £12,094 = £2,419
• Intermediate 21% × £16,171 = £3,396
• Higher 42% × £11,338 = £4,762
• Total: £11,114

England:

• PA £12,570: £0
• Basic 20% × £37,700 = £7,540
• Higher 40% × £4,730 = £1,892
• Total: £9,432

Mark pays £1,682 more in Scotland. Material — equivalent to ~£140/month.

James, £90,000 in Aberdeen (Scotland) vs Manchester (England)

Scotland:

• PA £12,570: £0
• Starter 19% × £2,827 = £537
• Basic 20% × £12,094 = £2,419
• Intermediate 21% × £16,171 = £3,396
• Higher 42% × £31,338 = £13,162
• Advanced 45% × £14,999 = £6,750
• Total: £26,264

England:

• PA £12,570: £0
• Basic 20% × £37,700 = £7,540
• Higher 40% × £39,730 = £15,892
• Total: £23,432

James pays £2,832 more in Scotland.

The £100k+ trap — both nations equally bad

Both England and Scotland inherit the Westminster-set personal allowance taper (£100k–£125,140 reduces allowance by £1 for every £2 of income, creating the 60% trap). Above £125,140 the PA is gone entirely.

The combined marginal rate in the £100k–£125,140 band is roughly:

• England: 40% IT + 50% PA loss × 40% = effective 60% marginal.
• Scotland: 45% Advanced IT + 50% PA loss × 45% = effective 67.5% marginal — even worse.

For high earners in Scotland, salary-sacrificing into pension to escape the trap is therefore even more compelling.

What is the same?

UK-wide (Scotland and rUK identical):

• Personal Allowance £12,570.
• National Insurance (employee 8%/2% and employer 15%).
• Dividend tax rates (8.75%/33.75%/39.35%).
• Capital Gains Tax rates (18%/24% residential, 18%/24% other).
• Inheritance Tax £325k nil-rate band.
• Pension annual allowance £60,000.
• ISA allowance £20,000.
• State Pension (DWP-administered).

What is different beyond income tax in Scotland?

LBTT (Land and Buildings Transaction Tax)

Replaces SDLT. Scottish bands are different — see our stamp duty comparison post.

Council Tax

Different bands and amounts in Scotland. Bands A–H but at different value thresholds than England. Most Scottish councils set rates 10–20% lower than English equivalents.

Plan 4 Student Loan

Scottish students from 2021 onwards repay on Plan 4: 9% on earnings above £32,745 (vs Plan 2 £28,470). Higher threshold = slightly less student loan deduction, ironically.

Business rates and devolved business taxes

Different non-domestic rate regime. Not relevant to most individuals.

Cross-border considerations

If you're considering moving Scotland ↔ rUK:

• Income tax residency is determined by where you live, not where you work. The "Scottish taxpayer" status follows your main residence.
• HMRC's Statutory Residence Test governs UK-wide residency, separately.
• For mixed residence (e.g. moving mid-year), HMRC apportions by where you lived more than half the tax year.
• Self Assessment still goes to HMRC (not Revenue Scotland) — HMRC just applies Scottish bands to your taxable income.

The practical decision for a higher-rate earner: moving from Scotland to England saves £2,000–£3,000/year of income tax, vs typically £500–£1,500/year cheaper council tax in Scotland. Net swing usually favours rUK for £50k+ earners by about £1,500–£2,500/year.

But: that's a small number compared to housing costs, job opportunities, family location and lifestyle. Not many people actually move purely for tax.

What changes in April 2026

The Scottish Budget (typically delivered in mid-December) sets the bands for the next Scottish tax year. As of the publication of this article, the Scottish bands for 2026/27 broadly carry from 2025/26 with modest threshold adjustments.

Specifically for 2026/27 (subject to Holyrood Budget changes):

• Personal Allowance: £12,570 (frozen UK-wide).
• Scottish bands: modest inflation adjustments to threshold positions.
• Top rate threshold: £125,140 (aligned with UK personal allowance taper end).
• Rates: 19%/20%/21%/42%/45%/48% — no rate changes signalled.

Try the numbers

For income tax only:

Sources

• HMRC: Income Tax rates and Personal Allowances
• HMRC: Scottish Income Tax rates
• Revenue Scotland and Scottish Government Budget 2025/26
• gov.uk: Student loan repayments — Plan 4
• IFS Green Budget analysis on Scottish vs rUK income tax structure