Ignorance is ... SRIT

17 September 2015

Well, now we know what we have suspected for some time. Taxpayers, and in particular Scottish taxpayers, have absolutely no idea that there will be any changes to the Income Tax rate in Scotland. A research report conducted on behalf of HMRC by Ipsos Mori, identified only one participant from 85 who were questioned having any knowledge of the changes. A further study of 2,000 taxpayers was no better, with a ‘low level of awareness’ that any major change to Income Tax in Scotland was happening.

While pension providers, payroll agents and large employers had a good knowledge as you would expect, small employers’ knowledge was described as ‘vague’. Just as important, the taxpayers had difficulty in understanding who a Scottish taxpayer will be, particularly mobile workers who were residing in one jurisdiction and working in another. It seems that the fact that SRIT is based on main residence and not on work location has not been understood - if explained at all.

So, with seven months to go until the SRIT is due to come into effect, and only four months until John Swinney presents his Scottish Budget, few people actually have any understanding of what this will mean in practice. Given that the taxpayers to whom the tax relates are unsure of who they are and that they have no idea that changes will be undertaken anyway, suggests chaos will reign when the new tax system in Scotland is live.

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