UK income tax rates and bands for 2026/27
The 2026/27 tax year runs from 6 April 2026 to 5 April 2027. Here are the rates you'll pay on earnings, savings and dividends, and what they mean for your take-home pay.
Your tax-free Personal Allowance
Most people can earn £12,570 a year before paying income tax. The allowance has been frozen at this level since 2021 and is due to stay frozen until April 2031. That means more of any pay rise is taxed each year.
If your adjusted net income is over £100,000, you lose £1 of allowance for every £2 above that. It's gone completely at £125,140. This creates an effective 60% tax rate, explained in our guide to the 60% tax trap.
England, Wales and Northern Ireland
| Band | Taxable income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Basic rate | £12,571 to £50,270 | 20% |
| Higher rate | £50,271 to £125,140 | 40% |
| Additional rate | Over £125,140 | 45% |
Wales can set its own rates, but they're currently the same as England's.
Scotland
If you live in Scotland, different rates apply to your earnings, pensions and rental income. The Scottish Budget raised the starter and basic rate thresholds for 2026/27. The rates themselves didn't change.
| Band | Taxable income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Starter rate | £12,571 to £16,537 | 19% |
| Basic rate | £16,538 to £29,526 | 20% |
| Intermediate rate | £29,527 to £43,662 | 21% |
| Higher rate | £43,663 to £75,000 | 42% |
| Advanced rate | £75,001 to £125,140 | 45% |
| Top rate | Over £125,140 | 48% |
Scottish taxpayers still pay UK rates on savings interest and dividends.
What it means for your pay
Annual take-home pay for 2026/27, with income tax and employee National Insurance only. There's no pension or student loan in these figures.
| Salary | England, Wales & NI | Scotland | Difference |
|---|---|---|---|
| £20,000 | £17,919.60 | £17,959.27 | +£39.67 |
| £25,000 | £21,519.60 | £21,559.27 | +£39.67 |
| £35,000 | £28,719.60 | £28,704.53 | −£15.07 |
| £50,000 | £39,519.60 | £38,023.55 | −£1,496.05 |
| £75,000 | £54,057.40 | £52,007.35 | −£2,050.05 |
| £100,000 | £68,557.40 | £65,257.35 | −£3,300.05 |
| £150,000 | £91,286.40 | £85,355.05 | −£5,931.35 |
People in Scotland on lower salaries pay slightly less tax, thanks to the 19% starter rate. From about £33,500 upwards they pay more.
National Insurance
Employees pay Class 1 National Insurance of 8% on earnings between £12,570 and £50,270 a year, and 2% above that. The thresholds are the same across the UK. Employers pay 15% on earnings above £5,000. Self-employed people pay Class 4 NI of 6% on profits between £12,570 and £50,270, and 2% above. You stop paying once you reach State Pension age.
Savings and dividends
- Personal Savings Allowance: basic-rate taxpayers can earn £1,000 of interest tax-free, and higher-rate taxpayers £500. Additional-rate taxpayers get none.
- Starting rate for savings: up to £5,000 of interest can also be tax-free if your other income is low. It shrinks by £1 for every £1 of other income above £12,570.
- Dividends: the first £500 is tax-free. Above that, dividends are taxed at 10.75% in the basic band, 35.75% in the higher band and 39.35% in the additional band. The first two rates rose by 2 percentage points from April 2026.
Interest and dividends inside an ISA are tax-free and don't count towards any of these limits.
See how these rates apply to your salary.
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