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Scotland Act 2012

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This is the original version (as it was originally enacted).

26Income tax for Scottish taxpayers

This section has no associated Explanatory Notes

(1)The Income Tax Act 2007 is amended as follows.

(2)In section 6 (the rates of income tax) after subsection (2) insert—

(2A)Subsection (2) does not apply to the non-savings income of a Scottish taxpayer.

(2B)The basic rate, higher rate and additional rate for a tax year on the non-savings income of a Scottish taxpayer is to be found as follows.

  • Step 1

    Take the basic rate, higher rate or additional rate determined as such under subsection (2).

  • Step 2

    Deduct 10 percentage points.

  • Step 3

    Add the Scottish rate (if any) set by the Scottish Parliament for that year.

(2C)Chapter 2 of Part 4A of the Scotland Act 1998 makes provision about the meaning of “Scottish taxpayer” and the setting of the Scottish rate.

(3)In section 10 (income charged at particular rates: individuals) after subsection (3A) insert—

(3B)If the individual is a Scottish taxpayer, the basic rate, higher rate and additional rate are—

(a)on so much of the individual’s income as is savings income, the rates determined as such under section 6(2);

(b)on so much of the individual’s income as is not savings income, the rates determined as such under section 6(2B).

(3C)Section 16 has effect for determining which part of a Scottish taxpayer’s income consists of savings income.

(4)In section 16 (savings and dividend income to be treated as highest part), in subsection (1) before paragraph (a) insert—

(za)which part of a Scottish taxpayer’s income consists of savings income,.

(5)In section 809H (charge on nominated income of long-term UK resident), after subsection (3) insert—

(3A)For the purpose of calculating income tax charged under subsection (2), ignore section 6(2A) to (2C) (special rates of income tax for Scottish taxpayers).

(6)In section 989 (definitions), in the definitions of “additional rate”, “basic rate” and “higher rate”, after “section 6(2)” insert “or (2B)”.

(7)In section 1 of the Provisional Collection of Taxes Act 1968 (temporary statutory effect of resolution of House of Commons), after subsection (3) insert—

(3A)If a resolution specifies the basic rate, higher rate or additional rate of income tax, the resolution has effect in relation to Scottish taxpayers (within the meaning of Chapter 2 of Part 4A of the Scotland Act 1998) as if it specified the rate calculated in accordance with section 6(2A) to (2C) of the Income Tax Act 2007.

(8)The amendments made by this section have effect in relation to the tax year appointed by the Treasury under section 25(5) and subsequent tax years.

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