Income Tax bands 2026/27 (England, Wales and Northern Ireland)
These rates apply to earnings, pensions and most other non-savings, non-dividend income for taxpayers in England, Wales and Northern Ireland. The figures are unchanged from 2025/26: the main thresholds have been frozen since 2021 and, following the Autumn Budget 2025, are due to stay frozen until April 2031. Source: HMRC, *Rates and thresholds for employers 2026 to 2027* (GOV.UK).
- Strictly, the basic rate band is the first £37,700 of taxable income *after* the Personal Allowance, which is why the higher rate starts at £12,570 + £37,700 = £50,270.
- The bands apply to income *above* each threshold only. Moving into the higher rate band does not mean all your income is taxed at 40%; only the part above £50,270 is.
| 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% |
The £100,000 taper: the hidden 60% rate
Your Personal Allowance falls by £1 for every £2 of adjusted net income above £100,000. It disappears entirely at £125,140.
Between £100,000 and £125,140 every extra £1 of income costs 40p in higher rate tax *plus* 20p from losing 50p of allowance (taxed at 40%), an effective marginal rate of 60%, or 62% once 2% National Insurance is added.
Pension contributions (including salary sacrifice) and Gift Aid donations reduce adjusted net income, so they are the usual way to claw the allowance back.
Scotland has different bands
If you are a Scottish taxpayer (your main home is in Scotland), the Scottish Parliament sets the rates and bands on non-savings, non-dividend income. The Personal Allowance (£12,570) and the taper are the same UK-wide. The 2026/27 Scottish bands, expressed as total income, are:
- Source: HMRC *Rates and thresholds for employers 2026 to 2027*, which lists the bands above the Personal Allowance; full details are published at gov.scot.
- National Insurance is UK-wide, so Scottish taxpayers still pay 8% NI up to £50,270 even though Scottish higher rate tax starts lower. Our salary calculator currently uses the rest-of-UK bands.
| Scottish band | 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% |
National Insurance for employees 2026/27
Employees pay Class 1 National Insurance on earnings from employment. Unlike Income Tax it is worked out per pay period (weekly or monthly), not annually, and it stops at State Pension age.
- The Primary Threshold (£12,570) is aligned with the Personal Allowance, and the Upper Earnings Limit (£50,270) with the higher rate threshold.
- Employers pay their own secondary contributions on top of salary; these do not come out of your pay.
| Earnings | Employee rate (category A) |
|---|---|
| Up to £12,570 a year (£1,048 a month) | 0% |
| £12,570 to £50,270 a year | 8% |
| Over £50,270 a year (£4,189 a month) | 2% |
Student loan repayment thresholds 2026/27
Student loan repayments are collected through PAYE alongside tax and NI. You repay a percentage of your earnings above the threshold for your plan:
- Source: HMRC *Rates and thresholds for employers 2026 to 2027*.
- If you have a Postgraduate Loan as well as an undergraduate plan, both deductions apply at the same time.
| Plan | Annual threshold | Rate |
|---|---|---|
| Plan 1 | £26,900 | 9% |
| Plan 2 | £29,385 | 9% |
| Plan 4 (Scotland) | £33,795 | 9% |
| Plan 5 | £25,000 | 9% |
| Postgraduate Loan | £21,000 | 6% |
Dividends
Dividends are taxed separately and use the band you fall into once your other income has been counted. The dividend allowance is £500 a year. From 6 April 2026 the dividend rates rose by 2 percentage points at the basic and higher rates:
- Source: GOV.UK, *Tax on dividends*.
| Band | Dividend rate 2026/27 |
|---|---|
| Basic rate | 10.75% |
| Higher rate | 35.75% |
| Additional rate | 39.35% |
Worked examples (no pension, no student loan)
These figures come from the same engine as our salary calculator, for an employee in England on a standard 1257L tax code with no pension contributions or student loan.
| Salary | Income Tax | Employee NI | Take-home (year) | Take-home (month) |
|---|---|---|---|---|
| £30,000 | £3,486.00 | £1,394.40 | £25,119.60 | £2,093.30 |
| £60,000 | £11,432.00 | £3,210.60 | £45,357.40 | £3,779.78 |
| £110,000 | £33,432.00 | £4,210.60 | £72,357.40 | £6,029.78 |
How the £110,000 figure is worked out
Personal Allowance: £12,570 − (£110,000 − £100,000) ÷ 2 = £7,570
Taxable income: £110,000 − £7,570 = £102,430
Basic rate: £37,700 × 20% = £7,540; higher rate: (£102,430 − £37,700) × 40% = £25,892. Total tax £33,432
NI: (£50,270 − £12,570) × 8% = £3,016 plus (£110,000 − £50,270) × 2% = £1,194.60. Total £4,210.60
Take-home: £110,000 − £33,432 − £4,210.60 = £72,357.40 a year
Tips and common pitfalls
- Check your tax code. 1257L means a £12,570 allowance. An emergency code, or a K code for benefits in kind, changes your pay considerably.
- Salary sacrifice reduces both tax and NI, whereas relief-at-source pension contributions only extend your basic rate band.
- Marriage Allowance lets a non-taxpayer transfer £1,260 of allowance to a basic rate spouse or civil partner.
- High Income Child Benefit Charge applies once adjusted net income exceeds £60,000 and recovers all Child Benefit at £80,000.