HMRC to contact Scottish taxpayers over new income tax
Taxpayers in Scotland are to receive a letter from HM Revenue and Customs this week as part of preparations for the new Scottish Rate of Income Tax.
The letters are intended to confirm the accuracy of HMRC's records for the 2.6 million taxpayers who live in Scotland and who will pay the new rate.
Recipients will not need to take any action if the address details HMRC holds for them are correct.
The Scottish Rate of Income Tax comes into effect on 6 April next year.
It will be paid by UK taxpayers who live in Scotland, regardless of where they work, with the rate to be announced by the Scottish government in its draft budget on 16 December.
Those paying the new rate will see their tax code prefixed by an 'S' and their income tax will continue to be collected from pay and pensions in the same way as it is now.
The new system was a recommendation of the Calman Commission and has been devolved under the Scotland Act 2012 along with powers over stamp duty and landfill tax
It will see the UK income tax rate being reduced by 10p in the pound across all bands in Scotland, with the Scottish Parliament then setting its own rate, which could be lower, higher or exactly the same as the rest of the UK.
The first minister, Nicola Sturgeon, has already hinted that her government is likely to keep the Scottish rate at the same level as the rest of the UK as any tax rises or cuts would need to be applied across all tax bands.
The Scottish Parliament is to receive greater powers over income tax under the new Scotland Bill proposals which are still going through the UK Parliament and which are expected to come into force in 2018.
The Scotland Bill will hand Holyrood control over income tax rates and bands, which would give the Scottish government greater flexibility to introduce a higher rate of income tax for high earners if it wished to do so.