Income Tax UK: Tax Codes, Allowances, PAYE, Scottish Rates and Reliefs

UK Tax Brackets 2026/27 — Income Tax Rates Quick Reference

Complete UK income tax brackets for 2026/27 tax year. England, Wales, Scotland, and Northern Ireland rates, plus worked examples showing how much tax you'll pay at each salary level.

· · Last reviewed: · 6 min read Updated for 2026/27 tax year

Tax information is based on HMRC rules for the 2026/27 tax year. Tax rules can change — always verify current rates at GOV.UK. This is not tax advice. Consider consulting a qualified tax adviser for your personal situation.

For a comprehensive overview of income tax, see our Income Tax guide.

The 2026/27 tax year runs from 6 April 2026 to 5 April 2027. Here are all the income tax brackets you need to know.

Income tax is the largest single deduction from most employees’ pay, but many people don’t fully understand how the banded system works. A common misconception is that moving into a higher tax bracket means all your income is taxed at the higher rate — but that’s not how it works. Only the income above each threshold is taxed at the higher rate. A £55,000 earner doesn’t pay 40% on all their income; they pay 40% only on the £4,730 above the £50,270 threshold.

For 2026/27, the thresholds remain frozen for the fifth year running. The government has kept the Personal Allowance and higher-rate threshold unchanged since 2021, meaning that as wages rise with inflation, more workers are being pushed into higher tax bands each year. This process — known as fiscal drag — is effectively a stealth tax increase that doesn’t require a rate change.

Read more: See our Take Home Pay guide for a complete overview of this topic.

England, Wales & Northern Ireland — Tax Brackets 2026/27

Tax Band Taxable Income Tax Rate
Personal Allowance £0 – £12,570 0%
Basic Rate £12,571 – £50,270 20%
Higher Rate £50,271 – £125,140 40%
Additional Rate Over £125,140 45%

Scotland — Tax Brackets 2026/27

Scotland sets its own income tax rates on earned income (employment, self-employment, pensions). Scottish residents pay:

Tax Band Taxable Income Tax Rate
Personal Allowance £0 – £12,570 0%
Starter Rate £12,571 – £14,876 19%
Basic Rate £14,877 – £26,561 20%
Intermediate Rate £26,562 – £43,662 21%
Higher Rate £43,663 – £75,000 42%
Advanced Rate £75,001 – £125,140 45%
Top Rate Over £125,140 48%

Note: Scottish income tax only applies to earnings (salary, self-employment, pension income). Savings interest and dividends are taxed at UK rates.

Tax by Salary — Quick Lookup (England/Wales/NI)

Gross Salary Income Tax NI Total Deductions Take-Home
£15,000 £486 £194 £680 £14,320
£20,000 £1,486 £594 £2,080 £17,920
£25,000 £2,486 £994 £3,480 £21,520
£30,000 £3,486 £1,394 £4,880 £25,120
£35,000 £4,486 £1,794 £6,280 £28,720
£40,000 £5,486 £2,194 £7,680 £32,320
£45,000 £6,486 £2,594 £9,080 £35,920
£50,000 £7,486 £2,994 £10,480 £39,520
£55,000 £9,432 £3,111 £12,543 £42,457
£60,000 £11,432 £3,211 £14,643 £45,357
£70,000 £15,432 £3,411 £18,843 £51,157
£80,000 £19,432 £3,611 £23,043 £56,957
£100,000 £27,432 £4,011 £31,443 £68,557
£125,000 £42,518 £4,511 £47,029 £77,971
£150,000 £53,703 £5,011 £58,714 £91,286

Tax by Salary — Quick Lookup (Scotland)

Gross Salary Income Tax NI Total Deductions Take-Home
£15,000 £462 £194 £656 £14,344
£20,000 £1,462 £594 £2,056 £17,944
£25,000 £2,490 £994 £3,484 £21,516
£30,000 £3,636 £1,394 £5,030 £24,970
£35,000 £4,836 £1,794 £6,630 £28,370
£40,000 £6,036 £2,194 £8,230 £31,770
£45,000 £7,320 £2,594 £9,914 £35,086
£50,000 £9,420 £2,994 £12,414 £37,586
£55,000 £11,520 £3,111 £14,631 £40,369
£60,000 £13,620 £3,211 £16,831 £43,169
£70,000 £17,820 £3,411 £21,231 £48,769
£80,000 £22,320 £3,611 £25,931 £54,069
£100,000 £32,320 £4,011 £36,331 £63,669

How Tax Is Calculated

Income tax is charged on taxable income — your earnings after deducting your Personal Allowance. The tax is calculated band by band, not as a flat percentage of your total income. So a £60,000 earner doesn’t pay 40% on £60,000 — they pay 0% on the first £12,570, 20% on the next £37,700, and 40% only on the remaining £9,730.

Example: £45,000 Salary (England)

Step Calculation
Gross income £45,000
Minus Personal Allowance £45,000 - £12,570 = £32,430
Tax at 20% on £32,430 £32,430 × 20% = £6,486

Example: £75,000 Salary (England)

Step Calculation
Gross income £75,000
Minus Personal Allowance £75,000 - £12,570 = £62,430 taxable
Basic rate band £50,270 - £12,570 = £37,700 at 20% = £7,540
Higher rate band £75,000 - £50,270 = £24,730 at 40% = £9,892
Total tax £17,432

The 60% Tax Trap (£100,000 – £125,140)

This is one of the most financially painful traps in the UK tax system — and one of the most fixable. Between £100,000 and £125,140, your Personal Allowance is withdrawn at a rate of £1 for every £2 earned. This means you’re effectively paying tax on your income as normal, plus paying 40% tax on the income that used to be covered by your allowance. The combined effect is a 60% marginal rate.

The solution is nearly always to make pension contributions or salary sacrifice arrangements to bring your adjusted net income below £100,000. Every £1 contributed to your pension saves you 60p in tax within this band — making pension contributions extraordinarily efficient at this income level.

Once you earn over £75,000, it’s worth taking professional advice to plan your income and contributions.

Income Personal Allowance Effective Rate in Band
Up to £100,000 £12,570 40%
£100,001 – £125,140 Reduces by £1 per £2 60%
Over £125,140 £0 45%

How the 60% Trap Works

Extra £1,000 Earned Lost Allowance Extra Tax
£100,000 → £101,000 £500 £400 (40%) + £200 (lost allowance) = £600
£101,000 → £102,000 £500 £600
£124,000 → £125,000 £500 £600
£125,000 → £126,000 £0 (already gone) £450 (45%)

How to Avoid the 60% Trap

Strategy How It Helps
Pension contributions Reduce adjusted net income below £100,000
Salary sacrifice Same effect as pension
Gift Aid donations Extend basic rate band
Spread income over tax years Defer bonuses if possible

Personal Allowance Rules

Income Level Personal Allowance
Up to £100,000 £12,570
£100,001 – £125,140 Gradually reduced
Over £125,140 £0

Who Gets a Different Personal Allowance?

Situation Personal Allowance
Standard £12,570
Born before 6 April 1948 (rare) May be higher
Marriage Allowance transferred to spouse £11,310 (gave away £1,260)
Marriage Allowance received from spouse £13,830 (received £1,260)
Blind Person’s Allowance £12,570 + £3,070 = £15,640

Dividend Tax Rates 2026/27

Dividends have their own tax rates (on top of the £500 dividend allowance):

Tax Band Dividend Rate
Basic rate taxpayer 8.75%
Higher rate taxpayer 33.75%
Additional rate taxpayer 39.35%

Savings Interest Tax Rates 2026/27

Savings interest over your Personal Savings Allowance:

Tax Band Savings Rate Personal Savings Allowance
Basic rate 20% £1,000
Higher rate 40% £500
Additional rate 45% £0

Capital Gains Tax Rates 2026/27

Gains above the £3,000 annual exempt amount:

Asset Type Basic Rate Higher/Additional Rate
Most assets 18% 24%
Residential property 18% 24%
Business assets (BADR) 10% 10%

Key Dates for 2026/27 Tax Year

Date Event
6 April 2026 Tax year starts
31 January 2027 Self Assessment deadline (online) for 2025/26
5 April 2027 Tax year ends
31 January 2028 Self Assessment deadline for 2026/27

Changes from 2025/26

Item 2025/26 2026/27
Personal Allowance £12,570 £12,570 (frozen)
Basic rate threshold £37,700 £37,700 (frozen)
Higher rate threshold £50,270 £50,270 (frozen)
Additional rate threshold £125,140 £125,140 (frozen)
Dividend allowance £500 £500 (unchanged)
CGT annual exempt £3,000 £3,000 (unchanged)

The freeze on thresholds (in place since 2021) continues. With wage inflation, more people are being pushed into higher tax brackets — this is called fiscal drag.

Marginal vs Average Tax Rate

Term Meaning
Marginal rate Tax on your next £1 of income
Average rate Total tax ÷ total income

Example: £60,000 Salary

Calculation Amount
Total tax £11,432
Average rate £11,432 ÷ £60,000 = 19.1%
Marginal rate 40% (you’re in higher rate band)

Sources

  1. HMRC — Income Tax rates and Personal Allowances
  2. HMRC — Scottish Income Tax