UK Income Tax Bands 2026/27 (England, Wales, Northern Ireland)
| Band | Taxable Income | Rate | Tax on full band |
|---|---|---|---|
| Personal Allowance | £0 – £12,570 | 0% | £0 |
| Basic Rate | £12,571 – £50,270 | 20% | Up to £7,540 |
| Higher Rate | £50,271 – £100,000 | 40% | Up to £19,892 |
| ⚠ 60% Effective Rate | £100,001 – £125,140 | 60% effective | ~£15,084 |
| Additional Rate | Above £125,140 | 45% | Ongoing above threshold |
Note: the "60% trap" is not a formal band — it is the effective marginal rate caused by the Personal Allowance taper between £100,000 and £125,140. See below.
Personal Allowance: Frozen at £12,570 Until April 2031
The Personal Allowance — the amount of income you can earn before paying any income tax — is £12,570 for 2026/27. It has been frozen at this level since 2021/22 and will remain frozen until at least April 2031.
This means every pay rise you receive between now and 2031 is taxed in full (at 20% or more) without any compensating increase in your tax-free amount. At 3% annual wage growth, the typical UK worker's real income tax burden rises measurably every year through fiscal drag alone.
Marriage Allowance: up to £252/year extra
If you're married or in a civil partnership and one partner earns under £12,570, they can transfer 10% of their unused allowance (£1,257) to the higher earner. This saves the higher earner up to £251.40/year in tax. Apply at gov.uk/marriage-allowance.
Basic Rate: 20% on £12,571–£50,270
The basic rate applies to taxable income between £12,571 and £50,270 — covering earnings after your Personal Allowance up to the higher rate threshold. This is the most common band — the majority of UK workers pay only basic rate tax.
On top of 20% income tax, employees also pay 8% Class 1 NI in this band — giving a combined marginal rate of 28% for most workers earning up to £50,270. Above £50,270, NI drops to 2%.
Higher Rate: 40% on £50,271–£100,000
Income between £50,271 and £100,000 is taxed at 40%. With 2% NI also payable above £50,270, the combined marginal rate in this band is 42%. Note: the higher rate threshold has been frozen since 2021/22 alongside the Personal Allowance. In 2010/11 the higher rate only applied above £43,875 — but both thresholds have been frozen while inflation and wage growth have pulled millions of previously basic-rate workers into the 40% band.
The 60% Trap Zone: £100,001–£125,140
Between £100,000 and £125,140, your Personal Allowance is reduced by £1 for every £2 of income above £100,000. By £125,140, your allowance is zero. This taper creates an effective 60% marginal rate:
- 40% higher rate income tax on the extra income
- Plus 20% effective tax on the lost allowance (£1 of allowance lost per £2 earned = £1 at 40% = £0.20 extra per £1 earned)
- Total: 60% + 2% NI = 62% effective marginal rate
The only practical solutions are pension salary sacrifice (reduces gross income) or Gift Aid charitable donations (reduces adjusted net income). See our complete 60% trap guide for full examples.
Additional Rate: 45% Above £125,140
Income above £125,140 is taxed at the additional rate of 45%. There is no Personal Allowance at this level — all income is fully taxable. Combined with 2% NI, the effective rate on earnings above £125,140 is 47%.
Scotland: Six Bands, Higher Rates on Middle Earners
Scottish taxpayers pay income tax at rates set by the Scottish Parliament — these differ significantly from the rest of the UK and are generally higher for middle and upper earners:
| Band | Scotland 2026/27 | England/Wales 2026/27 |
|---|---|---|
| Starter rate | 19% on £12,571–£15,397 | 20% basic |
| Basic rate | 20% on £15,397–£27,491 | 20% |
| Intermediate rate | 21% on £27,491–£43,662 | 20% |
| Higher rate | 42% on £43,662–£75,000 | 40% |
| Advanced rate | 45% on £75,000–£125,140 | 40% |
| Top rate | 48% above £125,140 | 45% |
NI rates and thresholds are identical across the UK — Scotland only sets income tax rates, not NI. Scottish taxpayers have code S-prefix (e.g. S1257L).
Fiscal Drag: How Frozen Thresholds Are Raising Your Tax Bill
All income tax thresholds are frozen until at least April 2031. This means as wages rise with inflation (~3%/year), a growing proportion of each worker's pay is taxed:
| Salary | Taxpayers in this band (est. 2026) | Change from 2021 |
|---|---|---|
| Basic rate payers | ~29 million | Significant increase |
| Higher rate payers | ~6.5 million | Up from ~4.2m in 2021 |
| Additional rate payers | ~900,000 | Up from ~600,000 in 2021 |
The OBR estimates the threshold freeze raises additional revenue equivalent to a 2–3% income tax rate increase for the average worker over the freeze period — without a single vote on tax rates.
Complete Take-Home Pay Examples 2026/27
| Annual Salary | Income Tax | Employee NI | Net Annual | Net Monthly | Eff. Rate |
|---|---|---|---|---|---|
| £20,000 | £1,486 | £595 | £17,919 | £1,493 | 10.4% |
| £30,000 | £3,486 | £1,395 | £25,119 | £2,093 | 16.3% |
| £40,000 | £5,486 | £2,195 | £32,319 | £2,693 | 19.2% |
| £50,000 | £7,486 | £2,995 | £39,519 | £3,293 | 21.0% |
| £60,000 | £11,432 | £3,186 | £45,382 | £3,782 | 24.4% |
| £80,000 | £19,432 | £3,586 | £56,982 | £4,749 | 28.8% |
| £100,000 | £27,432 | £3,986 | £68,582 | £5,715 | 31.4% |
| £120,000 | £42,432 | £4,386 | £73,182 | £6,099 | 38.7% (trap zone) |
Figures use standard 1257L tax code, no pension or student loan deductions. Use our calculator for personalised results.
How to Legally Reduce Your Income Tax Bill
- Pension salary sacrifice — reduces gross pay before tax/NI, most efficient method
- Pension Relief at Source — basic rate relief automatic, higher rate via Self Assessment
- Gift Aid donations — extends basic rate band, reduces adjusted net income for PA taper purposes
- ISA contributions — shelter investment returns, dividends, and interest from further tax
- Marriage Allowance — transfer unused PA to higher-earning partner (up to £252/year saved)
- Childcare via salary sacrifice — if employer offers Childcare Vouchers legacy scheme
Calculate your exact tax
For a precise breakdown of income tax, NI, student loan repayments, and pension — for any salary, PAYE or self-employed — use the UK Take-Home Pay Calculator. All figures are updated for 2026/27 HMRC rates.
Sources
HMRC: Income Tax Rates and Personal Allowances 2026/27 · GOV.UK · House of Commons Library: Direct Taxes Rates 2026/27 · PwC UK Individual Tax Summary 2026/27 · GoFile.co.uk Personal Allowance guide 2026/27 · Morningstar UK tax calendar 2026. For guidance only — not financial or tax advice.