Deduction tables last updated in 2023 ahead of usual cycle

Scottish Ministers have made the Diligence against Earnings (Variation) (Scotland) Regulations 2024, which update the statutory tables governing how much can be deducted from wages to recover debts in Scotland¹. The instrument was laid under the negative procedure and takes effect in April 2025¹.

The protected minimum amount, the level of monthly earnings below which no deduction may be taken by an earnings arrestment, rises from £655.83 to £750¹. The Scottish Government said calculations based on consumer price inflation would have produced £729.28, and that the figure was rounded up based on average weekly earnings¹. The weekly threshold rises from £150.94 to £172.61 and the daily threshold from £21.56 to £24.66¹. The rate used for current maintenance arrestments and conjoined arrestment orders where all debts are current maintenance also rises from £21.56 to £24.66¹.

The bandings that set how much is deducted above the threshold also change. The lowest banding falls from 19% to 15% for those earning up to £1,500 a month, and an additional banding is added for those earning up to £2,500 a month¹. The policy note states the change is intended to let those earning less pay less and those earning more pay more, and that it does not affect the amount of debt to be repaid, though it may lengthen the time over which a debt is repaid¹.

The 2024 Regulations replace the Diligence against Earnings (Variation) (Scotland) Regulations 2023 (S.S.I. 2023/27), which are retained for transitional purposes¹. The policy note records that the tables were last updated in 2023, earlier than the usual three year uprate, to reflect the cost crisis and high inflation at the time, with the 2023 figures calculated on consumer price inflation between October 2020 and October 2022¹.

During scrutiny of the Bankruptcy and Diligence (Scotland) Act 2024, stakeholders and some MSPs called for the protected minimum amount to rise to £1,000 a month and for reform of the bandings, while local authority representatives raised concerns about unintended impacts from an increase at that level¹. The Scottish Government committed to consult on the protected minimum amount and the bandings and to update the tables in April 2025¹. No formal public consultation has been carried out on this instrument, though the Accountant in Bankruptcy circulated the proposal to stakeholders, and informal consultation took place with CoSLA, the Institute of Revenues Rating and Valuation and the Scottish Courts and Tribunal Service¹.

Why it matters for households

The changes apply to people in Scotland whose wages are subject to an earnings arrestment, most commonly in response to council tax arrears¹. From April 2025, deductions can only be taken once monthly earnings exceed £750, up from £655.83, so some people will keep more of their pay, and in a small number of cases will pay nothing through an arrestment until their earnings pass the new figure¹. Those earning above the threshold but up to £1,500 a month face a lower deduction rate of 15% rather than 19%, and a new band applies to earnings up to £2,500 a month¹. The policy note states there will be an impact on local authorities, which are the main users of earnings arrestments, and that most individuals will pay back less each month, which could mean some debts take longer to clear¹. Employers may face a small cost, which the note says is minimised by the April start coinciding with annual payroll updates¹. The Scottish Government does not expect any significant financial impact on itself¹.

What happens next

The Scottish Government has committed to consult on the protected minimum amount and the bandings, with the other matters raised by stakeholders to be considered in a public consultation¹. The regulations take effect in April 2025¹.