The Act fully devolves the power to raise taxes on land transactions and on waste disposal to landfill – it is expected that this will take effect in April 2015, at which point the existing Stamp Duty Land Tax and Landfill Tax will not apply in Scotland. The Act also provides powers for new taxes to be created in Scotland and for additional taxes to be devolved.
The note states that the ‘Scotland Act 2012 gives the Scottish Parliament the power to set a Scottish rate of income tax to be administered by HMRC for Scottish taxpayers'. It is expected to apply from April 2016.
On the difficult area of helping employers identify employees who are Scottish taxpayers, HMRC have stated that for employees and pensioners ‘HMRC will issue tax codes to employers in the months before April 2016 which will identify those employees who are Scottish taxpayers, and employers will deduct tax at the appropriate rates, which may be higher or lower than or the same as those which apply in the rest of the UK.’
It goes on to state that ‘the definition of a Scottish taxpayer is based on the location of an individual’s main place of residence’ but acknowledges that employers and taxpayers will need additional guidance.
There is a short guide available on the GOV.UK website called Scotland Act 2012.