Scottish high earners could save over £46,000 in income tax by living in England, Rathbones finds

High earners in Scotland could save more than £46,000 in income tax across five years by living in England and commuting to jobs in Scotland, according to analysis from Rathbones.

The firm said that top earners could pay around £8,900 less income tax in the first year alone if taxed as English residents, based on a salary of £250,000. 

With salary growth of 2% a year, the cumulative difference would rise above £46,000 after five years.

Gordon Lawrie, head of Rathbones’ Edinburgh office, said: “For higher earners, the tax map of the UK is becoming harder to ignore. 

“A worker can live on one side of the border, work on the other and, depending on their tax residence, face a materially different income-tax bill.

“High earners ask us a very simple question, namely can I save tax if I live in England and continue to work in Scotland?”

Lawrie added: “Someone earning £250,000, the difference could exceed £46,000 over five years, which is enough to make tax part of the conversation alongside housing, commuting and wider lifestyle considerations.”

Rathbones said that policymakers should focus on the long-term competitiveness of Scotland by creating a simpler and more competitive tax system.