Taxes, Benefits & Holidays

We all contribute tax to make our communities in Scotland better. Free healthcare, education and additional benefits means it’s worth it.

Everyone who works in Scotland pays tax from their earnings for the public services provided by the government. In the most cases, your employer automatically deducts personal income tax and national insurance (NI) from your weekly or monthly salary.

Income Tax

The amount of income tax that you pay depends on how much you earn in one year. However, you will be taxed at the same rate as everyone in the UK. All EU countries have agreements to ensure people are not taxed twice on the same income.

After you arrive in Scotland, contact the nearest HM Revenue and Customs (HMRC) office to let them know you are working for a company in Scotland. If you are self-employed, you must register with HM Revenue and Customs to ensure you pay the correct amount of tax at the right time.

National Insurance

National insurance (NI) tax helps pay for social security benefits such as free healthcare, sick and maternity pay. The amount of NI you pay depends on how much you earn and whether you work for a company or are self-employed.

After you arrive in Scotland, you need to apply for a National Insurance number from the HM Revenue and Customs (HMRC). It will be used as a unique reference for your UK tax and NI contributions. Once you have your number, you must also give it to your employer.

Council Tax

Roads, recycling and waste disposal are just some of the ways council tax is keeping Scottish towns and cities safe, clean and in top working order. When you rent or buy a property in Scotland you must pay council tax. It goes towards important public services like street lighting, household waste collection and water charges.

Generally council tax rates in Scotland are lower than in other parts of the UK. The cost varies and is based on the value of the property you rent or buy and the council tax category (band) your property is placed in.

Employee Benefits and Pensions

Life is full of change. Whether it’s changes to your health, your family or when you get ready to retire, Scotland takes care of you.

When you work in Scotland you may be entitled to employee benefits depending on your individual circumstances. Benefits are likely to include leave from work, sick pay, maternity pay and a pension.

Statutory Sick Pay

If you become ill and cannot work for more than four days in a row, but less than 28 weeks, you may be eligible for Statutory Sick Pay from your employer.

Maternity Pay

If you’re pregnant, you may be eligible for maternity pay from your employer. Statutory Maternity Pay (SMP) allows you to take time off work both before and after your baby is born.

SMP is paid for up to 39 weeks from when you take leave from your job. You and your employer may agree other terms, but this is not required by law. Your partner is also entitled to up to two weeks of paternity leave – in addition to another 26 weeks if you decide to return to work early.

State Pension

If you are eligible, the government will pay you a State Pension when you reach the national retirement age – normally between 60-65 years old. This is a weekly payment. However, the amount you’re eligible for depends on the number of years you have paid National Insurance from your salary in the UK.

Holidays & Paid Leave

Your hard work in Scotland is rewarded with a generous amount of paid holiday from your job to enjoy.

These holidays, also known as annual leave, are calculated according to the number of days you work. If you work full-time, 5 days a week, you’re normally entitled to at least 28 days of paid (statutory) holiday each year. Some companies offer more.

If you work part-time, you are also entitled to paid holiday each year. You can calculate the holidays you’re entitled to by multiplying the number of days you work by 5.6. For example, if you work three days a week, you’re entitled to 16.8 days paid holiday each year.

Public and Bank Holidays

Many organisations in Scotland close for public and bank holidays. While it’s not compulsory for employers to give you paid leave on a public or bank holiday, many do as an added incentive.

There are currently nine public and bank holidays in Scotland each year, usually on a Friday or Monday. Some of these are different to the rest of the UK. They include:

  • New Year's Day (January)
  • 2nd January
  • Good Friday (April) 
  • Early May Bank Holiday (May) 
  • Spring Bank Holiday (May/June) 
  • Summer Bank Holiday (August) 
  • St Andrew's Day (November) 
  • Christmas Day (December) 
  • Boxing Day (December)