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Second Job Tax Rules in Scotland – 2025/26 Guide

Thinking of taking on a second job in Scotland? In this 2025 guide, we break down how second incomes are taxed under Scottish rules, including what tax codes apply, how your personal allowance is affected, and what National Insurance you’ll owe. Whether you’re moonlighting for extra cash or freelancing on the side, understanding the latest thresholds and rates can help you avoid tax surprises and make smarter decisions.

By Team SalaryCalculate · 6/18/2025

1. Personal Allowance & How It’s Applied

Everyone gets a single Personal Allowance of £12,570 in 2025/26—no matter how many jobs you have gov.scot+11moneyhelper.org.uk+11simplybusiness.co.uk+11.

Scenario example:

If Job A pays £14,000 and Job B pays £6,000 annually, the full allowance usually applies to Job A. This results in:
  • Job A: £1,430 taxable at Scottish rates
  • Job B: taxable from the first pound until you claim allowance splitting.

2. Scottish Income Tax Bands & Rates

Tax rates in Scotland differ from the rest of the UK (excluding dividends and savings).

For 2025/26, the bands are:

Starter Rate – 19%

  • Applies to income between £12,571 and £15,397
  • Only the portion within this range is taxed at 19%

Scottish Basic Rate – 20%

  • Applies to income between £15,398 and £27,491
  • This range is taxed at 20%

Intermediate Rate – 21%

  • Applies to income between £27,492 and £43,662
  • This chunk of income is taxed at 21%

Higher Rate – 42%

  • Applies to income between £43,663 and £75,000
  • Income in this band is taxed at 42%

Advanced Rate – 45%

  • Applies to income between £75,001 and £125,140
  • Taxed at 45%

Top Rate – 48%

  • Applies to income above £125,140
  • Taxed at 48%

Implications for second job income:
Income from a second job is taxed at these Scottish rates, layered on top of your main job earnings.

3. PAYE Codes & Tax Deductions

Your second job will typically use one of these PAYE codes:

Double-check your payslips—if you’re overpaying at basic rate (SBR) but should be in a higher bracket, contact HMRC for an adjustment.

4. National Insurance Implications

Class 1 NICs are due on each job earning above £242 per week (~£12,570/year) simplybusiness.co.uk+3moneyhelper.org.uk+3taxsummaries.pwc.com+3:

💡 If both jobs exceed the weekly NIC threshold, you’ll pay NICs on each.

5. Self‑Employment & Second Job on the Side

If your second job is self‑employment, you must:

  • Register with HMRC by 5 October after the tax year starts.
  • File a Self Assessment by January 31, 2026
  • Pay Class 4 NICs: 6% on profits between £12,570–£50,270; 2% above
  • Possibly claim the £1,000 trading allowance, rising to £3,000 by 2029

6. How to Optimize & Avoid Surprises

  1. Claim Allowance Splitting: Contact HMRC to allocate part of your personal allowance to your second job.
  2. Update Tax Codes: Make sure you’re on an appropriate Scottish code for each job.
  3. Watch Combined Thresholds: Your total income might push you into a higher band like Intermediate or Higher.
  4. Prepare for NICs Twice: Both jobs above the £242/week threshold mean separate NICs payments.
  5. Self-Employment Planning: Keep clear income records, claim allowed expenses, and declare earnings on time.

✅ Summary Checklist

  • Your personal allowance (£12,570) applies once—consider splitting it.
  • Second job taxed under Scottish PAYE codes (SBR, SD0, etc.).
  • Scottish tax bands apply cumulatively across all sources.
  • Separate NICs may be charged if both jobs exceed thresholds.
  • If self-employed: register, track income, use trading allowance, file Self Assessment.

Final Advice

Stay ahead of HMRC notifications and review your tax codes and allowance split. If your combined income means a jump into higher Scottish tax bands, or if you're self-employed, planning and record-keeping are essential. When in doubt, reach out to HMRC or a qualified tax adviser.

For help with salary calculations try our Scotland salary tools.

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