With the new Scottish Income Tax rates and bands introduced from 6 April 2018, UK tax reliefs will continue to work north of the border as intended. The following will apply:
Transferable Marriage Allowance
Taxpayers can transfer 10% of their tax-free Personal Allowance to their spouse or civil partner. This can reduce their tax bill by up to £230 in 2017 to 2018, and £238 in 2018/19.
This allows charities to claim back 25p for every £1 donated, with the UK government making changes to ensure Scottish taxpayers benefit from the right rate of tax relief on Gift Aid. Charities will continue to pay Gift Aid at the basic rate. Higher and additional rate taxpayers will still be able to claim the difference between basic rates recovered by the charity and their own margin rate of tax.
Pension relief at source
For 2018/19, Scottish taxpayers will continue to receive 20% relief on their contributions at source. There will be no adjustment for those taxed at a rate less than 20%, but scope for those taxed at a rate higher than 20% to claim additional relief.
Finance cost tax relief (for private landlords)
This will be restricted to 20% for 50% of the eligible expense, with the balance attracting relief at an individual’s highest margin rate of tax during the rest of this tax year – as applicable to landlords across the rest of the UK.
Please contact us if you have any questions or need support.