UK Tax Year Changes 2026/27
Last updated 06/05/2026
Each tax year (6 April to 5 April) brings changes to the rates and thresholds that determine how much you pay. Here is a clear summary of what changed for 2026/27 and what it means for your take-home pay.
Personal Allowance — Still Frozen
The Personal Allowance remains at £12,570 for 2026/27, unchanged since 2021/22. This freeze was originally set to last until April 2028 under the previous government's plans.
Because the allowance has not kept pace with wage growth or inflation, more people are being pulled into higher tax bands — a process known as fiscal drag. If your salary has risen since 2021, a larger proportion is now taxable.
Income Tax Bands (England, Wales and Northern Ireland)
| Band | 2025/26 | 2026/27 |
|---|---|---|
| Personal Allowance | £12,570 | £12,570 (frozen) |
| Basic rate (20%) | £12,571–£50,270 | £12,571–£50,270 (frozen) |
| Higher rate (40%) | £50,271–£125,140 | £50,271–£125,140 (frozen) |
| Additional rate (45%) | Over £125,140 | Over £125,140 |
National Insurance
Employee NI rates and thresholds are unchanged from 2025/26 following the reductions made in that year:
| Threshold | Employee NI rate (Cat A) |
|---|---|
| Below Primary Threshold (£12,570/yr) | 0% |
| Primary Threshold to Upper Earnings Limit (£12,570–£50,270/yr) | 8% |
| Above Upper Earnings Limit (over £50,270/yr) | 2% |
Employer NI increased from April 2025. Employer NI is now charged at 15% (up from 13.8%) on salaries above the reduced Secondary Threshold of £5,000/yr (down from £9,100). This increases business costs but does not directly affect your take-home pay.
Student Loan Thresholds
Student loan repayment thresholds are uprated annually. For 2026/27:
| Plan | 2025/26 | 2026/27 |
|---|---|---|
| Plan 1 | £24,990 | £24,990 |
| Plan 2 | £27,295 | £27,295 |
| Plan 4 | £31,395 | £31,395 |
| Plan 5 | £25,000 | £25,000 |
| Postgraduate Loan | £21,000 | £21,000 |
Scottish Income Tax 2026/27
Scotland sets its own income tax rates and bands (but not the Personal Allowance or NI). The Scottish budget for 2026/27 confirmed the following:
| Band | Rate | Taxable income |
|---|---|---|
| Personal Allowance | 0% | Up to £12,570 |
| Starter rate | 19% | £12,571–£14,876 |
| Basic rate | 20% | £14,877–£26,561 |
| Intermediate rate | 21% | £26,562–£43,662 |
| Higher rate | 42% | £43,663–£75,000 |
| Advanced rate | 45% | £75,001–£125,140 |
| Top rate | 48% | Over £125,140 |
Scottish taxpayers see an S prefix in their tax code (e.g. S1257L). All Scottish workers pay the same NI rates as the rest of the UK.
High Income Child Benefit Charge
From April 2024, the High Income Child Benefit Charge (HICBC) threshold rose to £60,000 (from £50,000), and the full charge point moved to £80,000. These thresholds remain in place for 2026/27. Families where the highest earner makes between £60,000 and £80,000 face a tapered charge on Child Benefit received.
Capital Gains Tax
CGT rates for assets other than residential property were increased in October 2024 to align with the lower residential property CGT rates. The current rates are:
- Basic-rate taxpayers: 18% on gains
- Higher/additional-rate taxpayers: 24% on gains
- Residential property (all taxpayers): 18% / 24%
The Annual Exempt Amount remains at £3,000 for 2026/27.
What This Means for Your Pay
Use our salary calculator to see exactly how your take-home pay compares between 2025/26 and 2026/27 — we calculate the year-on-year difference automatically and show it below your results.