Most tax in the United Kingdom is set by the UK Parliament and applies identically from Shetland to Cornwall. But three taxes have been devolved in whole or in part, and businesses and individuals in Scotland, Wales and Northern Ireland meet rules that differ from England in specific, well-defined ways. Getting them wrong is common, particularly for people who have moved, who work across borders, or whose accountant is unfamiliar with the devolved regime. This guide sets out what differs and what does not for 2026/27.
What is the same everywhere
National Insurance, in all classes, is UK-wide. Corporation Tax, at 19% to 25% with marginal relief, is UK-wide; Northern Ireland has a power to set its own rate that has never been exercised. VAT is UK-wide, with the Northern Ireland exception for goods described below. Capital Gains Tax, Inheritance Tax, the dividend tax rates and allowance, the personal allowance and its taper, the savings allowances, and the rules on pensions are all UK-wide. Companies House operates registers in Cardiff for England and Wales, Edinburgh for Scotland and Belfast for Northern Ireland, with the same forms, fees and deadlines. HMRC is the tax authority throughout. Self Assessment, PAYE, Making Tax Digital and the Construction Industry Scheme apply everywhere on the same timetable.
Scotland: income tax
Scotland sets its own rates and bands of income tax on non-savings, non-dividend income: earnings, self-employed profit, pensions and rental income. For 2026/27 there are six bands above the UK-wide personal allowance of £12,570: starter rate 19% to £16,537, basic rate 20% to £29,526, intermediate rate 21% to £43,662, higher rate 42% to £75,000, advanced rate 45% to £125,140, and top rate 48% above. A Scottish taxpayer is someone whose main home is in Scotland for most of the tax year; HMRC identifies them with an S prefix on the tax code.
The practical effects: earned income between £43,662 and £50,270 is taxed at 42% in Scotland against 20% in England, which also affects the interaction with National Insurance at 8%, producing a marginal rate of 50% on that slice. Scottish higher earners pay more at every level above about £30,000. Savings and dividend income remain taxed at UK rates using UK bands, so a Scottish director's salary is taxed under Scottish bands while their dividends are taxed under UK bands, and the salary-and-dividend split needs calculating on both. Pension relief at source is given at 20%, with Scottish taxpayers claiming the additional relief at their higher Scottish rates through Self Assessment.
Scotland: property
Land and Buildings Transaction Tax replaces Stamp Duty Land Tax on property purchases in Scotland, with its own bands and rates and an Additional Dwelling Supplement of 8% on second homes and buy-to-lets. Scottish Landfill Tax replaces Landfill Tax. Revenue Scotland collects both. The Scottish Government also has a framework for a Scottish air departure tax, not yet in force.
Wales: income tax
Wales has Welsh rates of income tax: the UK rates on earned income are reduced by 10 percentage points and the Senedd sets Welsh rates to add back. Since the power began in 2019 the Senedd has set the Welsh rate at 10p in each band, so Welsh taxpayers currently pay exactly the same as English ones: 20%, 40% and 45%. The point is that it could change, and Welsh taxpayers are identified with a C prefix on their tax code so that it can. A Welsh taxpayer is someone whose main home is in Wales for most of the tax year.
Wales: property
Land Transaction Tax replaces Stamp Duty Land Tax in Wales, collected by the Welsh Revenue Authority, with its own bands and a higher-rate surcharge on additional properties. Landfill Disposals Tax replaces Landfill Tax. Companies incorporated in Wales may register their name and file documents in Welsh.
Northern Ireland: income tax and companies
Income tax in Northern Ireland follows the UK rates and bands with no devolution; there is no Northern Ireland tax code prefix. Corporation Tax is at UK rates. Companies register at Companies House in Belfast under the same Companies Act, with the same fees and filings. Stamp Duty Land Tax applies to property. Business rates are set by the Northern Ireland Executive under its own system.
Northern Ireland: VAT and goods
Under the Windsor Framework, Northern Ireland remains aligned with EU VAT rules for goods, while following UK rules for services. The practical consequences for a Northern Ireland business are that sales of goods to EU customers are treated as intra-EU supplies rather than exports, that EU VAT rules on distance selling and the One Stop Shop apply to goods sold to EU consumers, that goods moving from Great Britain to Northern Ireland follow the Framework's green and red lane arrangements, and that Northern Ireland VAT numbers carry an XI prefix for EU transactions. Services are entirely under UK VAT rules. For most Northern Ireland businesses selling locally none of this bites; for online sellers and distributors trading with the Republic of Ireland and the EU it is central, and our e-commerce and VAT returns services handle it.
Moving between nations
Your status as a Scottish or Welsh taxpayer is determined by where your main home is for the majority of the tax year, so a move in October changes the whole year's treatment. Tell HMRC your new address promptly, because the tax code prefix, and therefore the PAYE deductions, follows the address HMRC holds. People who move and do not update it are the commonest source of Scottish and Welsh rate errors.
Cross-border work
Employment income is taxed according to the employee's residence, not the employer's location, so an Edinburgh employer with an employee living in Carlisle operates an English code for them and a Scottish code for staff living in Scotland. The same applies to self-employed profit and rental income. Companies are taxed by UK rules wherever in the UK they are.
Getting it right
Our services apply the correct devolved rules automatically from the address and the facts: Scottish bands on Self Assessment, the right tax codes on payroll, Belfast register filings for Northern Ireland company accounts, and Windsor Framework treatment on VAT. The take-home pay calculator applies the Scottish bands when selected.
A worked example
Two consultants each earn £60,000 of self-employed profit. The one in Manchester pays income tax of £11,432 and Class 4 National Insurance of £2,456.60. The one in Glasgow pays Scottish income tax of £14,116 on the same profit and the same Class 4 of £2,456.60, because National Insurance is UK-wide. The Scottish consultant pays £2,684 more. If each had instead taken the income as £12,570 of salary and £47,430 of dividends from a company, the dividend tax would be identical for both, because dividends are taxed at UK rates on UK bands, and the difference would shrink to nothing. That asymmetry is why the structure decision has a different answer in Scotland.
Business rates and local taxes
Business rates are devolved everywhere and differ in rate, reliefs and revaluation cycle between England, Scotland, Wales and Northern Ireland. Small business rates relief thresholds in particular vary, and a business with premises should check the regime for its own nation rather than assume the English rules. Council tax, licensing fees and local levies are likewise set locally. None of these are handled through HMRC and none appear on tax returns, but they are real costs of trading that a business plan should include.
Grants and support
Each nation runs its own business support schemes through Scottish Enterprise, Business Wales, Invest Northern Ireland and the English growth hubs, with different eligibility and application processes. Grants are generally taxable as trading income when received, and the treatment is the same across the UK even though the schemes differ.