Created on: 23 Dec 2024 | Last modified: 24 Dec 2024
Scotland’s teachers have collectively been left out of pocket by potentially tens of millions of pounds, as the result of an ongoing impasse between 16 Scottish local authorities and His Majesty’s Revenue and Customs (HMRC) over the implications of the 2022-23 pay settlement to Scotland’s teachers.
Tax changes which came into force in April 2023 led to tens of thousands of teachers being overtaxed on back pay earned during the year 2022-2023, but which was taxed at the higher 2023-2024 rate, as a result of late payments by a significant number of Scottish local authorities.
The loss for individual teachers varies, but generally runs to several hundred pounds of overpaid tax for each teacher involved.
Following many months of seeking resolution on behalf of its members – including frequent discussions with HMRC, COSLA and individual local authorities, and the employment of a firm of external tax advisors, the EIS has now escalated the matter to the highest level by writing to the Exchequer Secretary to the Treasury, James Murray MP, calling on the UK Government to resolve this issue as a matter of urgency by ordering he repayment of overpaid tax to the thousands of Scotland’s teachers who are owed it.
In the letter to Mr Murray, EIS General Secretary Andrea Bradley says, "I write with regard to the classification of backpay owed to thousands of our members in respect of the tax year 2022/23, which was not paid on time but was paid in the following tax year by payroll systems across a large number of Scottish local authorities.
"This was following a protracted dispute over pay, where resolution was only reached through EIS members taking extensive industrial action, which ended with a settlement being reached in early March 2023."
The letter continues, "From April 2023, thousands of EIS members, across 16 local authorities, have suffered significant financial disadvantage as a result of the delay in receiving backpay through no fault of their own – as the backpay paid in in the tax year 2023/24 fell to be taxed at the Scottish higher rate of 42%, rather than typically being taxed at 21% if it had been paid in the preceding year, as it was for teachers in Scotland’s other 16 local authorities."
The letter adds, "Since first being made aware of the issue in April 2023, the EIS has repeatedly attempted to seek a resolution. Thus far, however, neither HMRC nor the 16 local authorities in question seem willing to rectify what are scandalous detriments to thousands of Scottish teachers, the EIS believing the total amount that Scottish teachers are owed, to run to tens of millions of pounds."
The letter concludes, "We trust that you will agree that continuation of this situation is neither fair nor acceptable, and that HMRC, COSLA (Convention of Scottish Local Authorities) and the 16 local authorities in which teachers have been underpaid, ought no longer to avoid doing what is right and what is required to bring about a just resolution.
"We respectfully request that you raise this matter with the relevant HMRC colleagues as an important next step towards the realisation of pay justice for the tens of thousands of Scottish teachers who continue to suffer this detriment."
Information Sheet detailing actions thus far
Audio clip on the release from EIS General Secretary, Andrea Bradley: