Income Tax Rates and Allowances 2026/27

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This is the guide with the numbers. Everything in it is for the 2026/27 tax year — 6 April 2026 to 5 April 2027 — for England, Wales, and Northern Ireland. Scotland sets its own bands, which are noted at the end. The figures come from GOV.UK and from the Budget 2026 rates and allowances tables, and they are unchanged from 2025/26: the Personal Allowance and the bands have been frozen for years.

The 2026/27 rates at a glance

Personal Allowance: £12,570 (0%). Basic rate: 20% on income from £12,571 to £50,270. Higher rate: 40% on income from £50,271 to £125,140. Additional rate: 45% on income over £125,140. If your adjusted net income is over £100,000, your Personal Allowance falls by £1 for every £2 over £100,000, and it is zero at £125,140.

The Personal Allowance

The Personal Allowance is the amount of income you can earn each year before you pay any Income Tax. For 2026/27 it is £12,570. If your total income is less than that, you have no Income Tax to pay. The allowance applies once, across all your income — you do not get a separate allowance for each job or each source of income.

The allowance has been frozen at £12,570 since April 2021, and it is legislated to stay there until at least April 2028. A frozen allowance matters: when wages rise with inflation but the allowance stays still, more of your income falls into tax, and more of it falls into the higher bands. That slow effect is sometimes called fiscal drag, and it is the reason the frozen thresholds are a regular news story.

The three bands

Above the Personal Allowance, your income is taxed in bands. The basic rate is 20%, and it applies to taxable income up to £37,700 — that is, total income up to £50,270. The higher rate is 40%, and it applies to taxable income from £37,701 to £112,570 — total income up to £125,140. The additional rate is 45%, and it applies to everything above £125,140.

The key point, repeated because it is the most common misunderstanding, is that the rate applies to the slice, not the whole. Moving into the 40% band does not mean all your income is taxed at 40% — only the part above £50,270. A pay rise that takes you just over a threshold costs you tax only on the small amount above the threshold.

Worked examples

Take a salary of £50,000. The first £12,570 is tax-free. The remaining £37,430 is taxed at 20%, which comes to about £7,486 of Income Tax for the year. Take a salary of £60,000. The first £12,570 is tax-free, the next £37,700 is taxed at 20% (£7,540), and the remaining £9,730 is taxed at 40% (£3,892) — about £11,432 in total. These are Income Tax figures only; National Insurance is charged separately, and it is explained in its own guide.

Now take £110,000. The taper has already started: your Personal Allowance is reduced by £1 for every £2 over £100,000, so at £110,000 you have lost £5,000 of allowance and keep £7,570. You pay 20% on the slice up to £50,270, 40% on the rest, and the lost allowance means more of your income is taxed. That is why the effective rate between £100,000 and £125,140 is much higher than 40% — a fact worth knowing before you turn down a pay rise or a bonus in that range.

The £100,000 taper

If your adjusted net income is over £100,000, your Personal Allowance falls by £1 for every £2 above £100,000. At £110,000 you lose £5,000; at £120,000 you lose £10,000; at £125,140 the allowance is zero. Adjusted net income is broadly your total taxable income minus certain reliefs, such as pension contributions and Gift Aid — which is why pension contributions can restore some of your allowance, a point the pension tax relief guide explains.

The taper has a sharp practical consequence: between £100,000 and £125,140, each extra £2 of income costs you £1 of allowance as well as 40% tax on the income itself, so the effective marginal rate in that band is around 60%. It is also the reason many people with income in this range are asked to file a Self Assessment return — HMRC needs a return to work out the tapered allowance properly.

Scotland is different

Scotland sets its own Income Tax bands and rates on non-savings, non-dividend income. For 2026/27 Scotland has six bands, with rates from 19% to 48%. The Personal Allowance is the same £12,570, and it tapers in the same way, but the bands above it are different — and the higher rates start at lower incomes than in the rest of the UK.

If you live in Scotland, do not use the bands in this guide. Check the Scottish rates on GOV.UK or on the Scottish government website, and check your tax code: Scottish taxpayers have codes starting with S, such as S1257L. Wales has its own rates too in law, but for 2026/27 the Welsh rates match the UK rates.

Sources: GOV.UK, Income Tax rates and Personal Allowances; HMRC, Budget 2026 Annex A: rates and allowances.

General information only. This page explains the 2026/27 income tax rates and allowances in plain English. It is not tax advice, and it cannot tell you what you owe or what you should do about your own tax. Always confirm the current rates, rules, and your own position on GOV.UK or with HMRC before you act, and get professional advice for anything complicated. Contact: hello [at] tapetoolhq.com.