UK Income Tax Rates and Bands 2026/27: A Plain-English Guide

Knowing the UK income tax rates and bands 2026/27 helps you check your pay, plan ahead and avoid surprises. This guide explains the Personal Allowance, the basic, higher and additional rates, and how they fit together for the tax year running from 6 April 2026 to 5 April 2027. It is written in plain English so you can see exactly how your income is taxed.

The Personal Allowance for 2026/27

Most people can earn a set amount each year before they pay any income tax at all. This is called the Personal Allowance, and for 2026/27 it is £12,570. Income up to this level is tax-free. For a deeper look at how this threshold works, see our guide to how the £12,570 Personal Allowance works.

The income you have left after deducting the Personal Allowance is known as your taxable income. It is this taxable income, not your total earnings, that the rates and bands below are applied to. You can check your own figures quickly with our income tax calculator.

Income tax rates and bands for 2026/27

For England, Wales and Northern Ireland, income above the Personal Allowance is taxed across three main bands in 2026/27. Each band only applies to the slice of income that falls within it, so you never pay the higher rate on your whole income. You can confirm the official figures in the Income Tax rates and bands published on GOV.UK.

In short, the bands work like this:

• You pay 20% on taxable income between £0 and £37,700.
• You pay 40% on taxable income between £37,700 and £125,140.
• You pay 45% on taxable income above £125,140.

Practical tip: because each rate only applies to its own slice of income, moving into the higher-rate band does not mean your whole salary is suddenly taxed at 40%. Only the part above the threshold is.

The taper that creates a 60% effective rate

The Personal Allowance is not guaranteed for everyone. If your income goes above £100,000, the allowance is reduced by £1 for every £2 of income over that figure. By the time your income reaches £125,140, the Personal Allowance has dropped to £0.

This taper has an unusual effect. Between £100,000 and £125,140, you lose allowance at the same time as paying tax on extra earnings, which produces an effective marginal rate of 60% on income in that range. It is often called the "60% trap", and it is worth being aware of if you are near that level of income or considering a bonus or pension contribution. One common way to manage this is through pension tax relief or a salary sacrifice arrangement, which can lower your taxable income.

A worked example: £45,000 salary

Seeing the bands in action makes them much easier to understand. Take someone with a salary of £45,000 in 2026/27, with the standard Personal Allowance:

1. Start with the salary: £45,000.
2. Deduct the Personal Allowance of £12,570, leaving taxable income of £32,430.
3. This £32,430 is all within the basic-rate band (which runs up to £37,700), so it is taxed at 20%.
4. £32,430 × 20% = £6,486 income tax for the year.

This person pays no higher-rate tax because their taxable income stays below the £37,700 basic-rate limit. To model your own salary in the same way, try our salary calculator or see what lands in your account with the take-home pay calculator. If you want to follow the full method step by step, read how to calculate your take-home pay.

Scotland, and how income tax differs from National Insurance

Official sources: Scottish income tax rates and bands are set by the Scottish Government - see gov.scot (Scottish Income Tax). Welsh taxpayers pay the GOV.WALES (Welsh Rates of Income Tax), currently aligned with England.

If you live in Scotland, your income tax is worked out using Scottish rates and bands, which are set separately by the Scottish Parliament and differ from those in England, Wales and Northern Ireland. The £12,570 Personal Allowance, however, is set UK-wide and applies wherever you live in the UK. If you are a Scottish taxpayer, check the specific Scottish bands rather than relying on the table above.

It is also important to remember that income tax is separate from National Insurance. They are two different deductions with their own thresholds and rules, even though both come out of your earnings. You can read more in our overview of National Insurance rates for 2026/27, or work out the figure with the National Insurance calculator. When you look at a payslip, the income tax figure is only part of the story.

A higher-rate worked example: £70,000 salary

To see how two bands combine, take someone earning £70,000 in 2026/27 with the full Personal Allowance. The calculation works slice by slice, so part of the income is taxed at 20% and only the part above the higher-rate threshold is taxed at 40%:

1. Start with the salary: £70,000.
2. Deduct the Personal Allowance of £12,570, leaving taxable income of £57,430.
3. The first £37,700 of taxable income is in the basic-rate band: £37,700 × 20% = £7,540.
4. The remaining £19,730 falls in the higher-rate band: £19,730 × 40% = £7,892.
5. Total income tax for the year is £7,540 + £7,892 = £15,432.

Notice that even though this person is a "higher-rate taxpayer", most of their tax is still charged at 20%. The 40% rate only ever bites on the slice above the threshold, which is why a small pay rise or bonus does not suddenly tax your whole salary more heavily. You can reproduce this calculation for any figure with our income tax calculator.

Common mistakes people make with the bands

Income tax bands are simpler than they look, but a few misunderstandings come up again and again. Avoiding them can save you both money and worry:

• Thinking the whole salary is taxed at the top rate. Crossing into the higher-rate band does not mean every pound is taxed at 40%. Only income above the threshold is.
• Confusing total income with taxable income. The rates apply to income after the Personal Allowance has been deducted, not to your gross pay.
• Forgetting the allowance can be tapered. If your income climbs above £100,000, the Personal Allowance shrinks, which changes the maths considerably.
• Assuming Scotland uses the same bands. Scottish taxpayers have their own rates and bands, so the table above will not match a Scottish payslip.
• Overlooking other income. Savings interest, dividends and rental profits can push you into a higher band even if your salary alone would not.

If your take-home pay looks different from what you expect, it is often worth checking your tax code as well as your band. A wrong code can leave you over- or under-paying regardless of which band you are in.

How the bands interact with savings, dividends and pensions

Your salary is not the only thing that uses up the bands. Savings interest and dividend income sit on top of your other earnings, so they are effectively taxed in the band your total income reaches. That means a higher salary can push your savings or dividends into a higher-rate slice, even if those amounts on their own would have been taxed gently. The Personal Savings Allowance can shelter some interest, and you can check how much with our personal savings allowance calculator.

Pension contributions work in the opposite direction. Paying into a pension can extend your basic-rate band or reduce your adjusted net income, which is particularly valuable if you are near the higher-rate threshold or caught in the 60% trap between £100,000 and £125,140. If you think you may be affected by that trap, our 60% tax trap calculator shows the effect on income in that range. Scottish taxpayers can model their position separately with the Scotland tax calculator.

Key dates for the 2026/27 tax year

The UK tax year does not follow the calendar year, which trips up a lot of people. A few dates are worth keeping in mind:

• 6 April 2026 - the 2026/27 tax year begins, and the rates and bands above start to apply.
• 5 April 2027 - the 2026/27 tax year ends.
• End of the tax year - your annual allowances reset, so unused allowances generally cannot be carried into the next year.

If you are employed under PAYE, the bands are applied automatically across your pay periods, so you rarely need to do anything. If you are self-employed or have other untaxed income, you usually settle the year's tax through Self Assessment after the tax year ends.

Frequently asked questions

What is the Personal Allowance for 2026/27?

The standard Personal Allowance for 2026/27 is £12,570. This is the amount of income you can receive before any income tax is due, although it can be reduced if your income is above £100,000.

What are the income tax rates for 2026/27?

For England, Wales and Northern Ireland, the basic rate is 20%, the higher rate is 40% and the additional rate is 45%. Each rate applies only to the slice of taxable income that falls within its band.

At what income do you start paying higher-rate tax?

You begin paying the 40% higher rate once your taxable income passes £37,700, which is roughly a total income of £50,270 if you have the full Personal Allowance. Only income above that point is taxed at 40%.

Why is there a 60% effective tax rate?

Between £100,000 and £125,140 of income, your Personal Allowance is gradually withdrawn at £1 for every £2 of income above £100,000. Losing the tax-free allowance while also paying tax on extra income creates an effective marginal rate of 60% across that range.

Are Scottish income tax rates the same?

No. Scotland sets its own income tax rates and bands, which are different from the rest of the UK. The £12,570 Personal Allowance still applies, but Scottish taxpayers should check the Scottish bands for the exact amounts.

Is National Insurance included in these rates?

No. The rates and bands above relate only to income tax. National Insurance is a separate deduction with its own thresholds, so your total deductions from earnings can be higher than income tax alone.

Related calculators: Income Tax Calculator, Salary Calculator, Take-Home Pay Calculator and National Insurance Calculator.

This guide is general information for the 2026/27 tax year, not personal tax advice. Check your own circumstances at gov.uk.

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All figures checked against HMRC published rates on 27 July 2026.