Glossary · UK
What is Scottish Starter Rate?
The lowest Scottish income tax band, charging 19% on the first £3,967 of non-savings, non-dividend income above the Personal Allowance for 2026/27.
Full Definition
The Scottish Starter Rate is the first and lowest of Scotland's six income tax bands, set by the Scottish Parliament and applying only to non-savings, non-dividend income (broadly earnings, pensions and rental profit) of Scottish taxpayers. For 2026/27 it charges 19% on taxable income from £0 to £3,967 above the UK-wide Personal Allowance of £12,570 -- so on gross earnings up to roughly £16,537. This is one percentage point below the 20% basic rate that applies UK-wide (and to the next Scottish band, the Scottish Basic Rate), meaning lower earners in Scotland pay slightly less income tax than equivalent taxpayers in England, Wales and Northern Ireland on the same portion of income. Above the Starter Rate band, income is taxed at the Scottish Basic Rate (20%), then the Intermediate Rate (21%), Higher Rate (42%), Advanced Rate (45%) and Top Rate (48%) as income rises. National Insurance, and the taxation of savings and dividend income, remain UK-wide and unaffected by Scottish rates. Whether the Starter Rate applies depends on residence -- broadly, having your only or main home in Scotland during the tax year -- rather than where you work or where your employer is based.