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Scottish Budget 2020/21

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The Scottish government delivered its draft budget on 6 February. Tax announcements included:

  • a new 2% rate of LBTT on non-residential leases from 7 February 2020 where the net present value of rent is over £2m;
  • Scottish rates of income tax are to remain unchanged, while thresholds will increase with inflation; and
  • Scottish landfill tax rates will rise with inflation.

Consultation will follow shortly on draft legislation to introduce two LBTT reliefs originally announced at Budget 2019/20, for the seeding of properties into property authorised investment funds or co-owned authorised contractual schemes (CoACS), and when units in CoACS are exchanged. See

Commenting on the income tax effects of the Scottish Budget, the CIOT noted that the inflationary increase in Scottish income tax basic and intermediate rate thresholds mean Scottish taxpayers earning less than £27,243 will continue to pay less in income tax than taxpayers elsewhere in the UK in 2020/21, while the frozen higher and top rate thresholds will keep earners above this level paying more.

The institute also commented that the UK Budget on 11 March, in which the Westminster government has promised to increase NICs thresholds, would have further implications for Scottish taxpayers.

Issue: 1475
Categories: News