The Scottish Government has proposed that the Scottish rate will be 10% for the tax year 2016 to 2017.

On 6th April 2016 a new rate of tax will come into effect for people who have their main address (for 183 days or more of the tax year) in Scotland.

What This Means For Your Payroll

You will not have to make any changes until the revenue issues you with a P9 tax code change notice for each employee that will need the new rate. Once you have received the new rate for an employee go to “Employee > Employee Maintenance > Tax and NI”. Either replace the existing tax code or add the new tax code in the “New Tax Code” box and enter the date that it will become effective. The new Scottish tax rates will have a prefix of an “S”.

The Scottish income tax deducted is not reported separately anywhere not the RTI FPS, payslip, P45 or P60.

Scottish Tax Rates

The Scottish tax rates for the 2016/17 year will remain the same as the rest of the UK.

Rate 1: 20% Above £11,000

Rate 2: 40% Above £32,000

Rate 3: 45% Above £118,000

Emergency Tax Code: 1100L

You can always check the current Scottish tax rates here: 


Employees will be classed as a Scottish taxpayer if the address HMRC holds for them is in Scotland. It’s their responsibility to notify the HMRC if they change their address. This can be done from here:

For more information see here:

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