Income tax and National Insurance, 2026/27 and 2027/28
| What | 2026/27 | 2027/28 |
|---|---|---|
| Personal allowance | £12,570 | £12,570 (frozen to 2031) |
| Basic rate 20% | £12,571 to £50,270 | Unchanged |
| Higher rate 40% | £50,271 to £125,140 | Unchanged |
| Additional rate 45% | Over £125,140 | Unchanged |
| Employee National Insurance | 8% from £12,570 to £50,270, 2% above | Unchanged (frozen to 2031) |
| Plan 2 student loan threshold | £29,385 | Frozen for three years from 2027/28 |
England, Wales and Northern Ireland. The personal allowance is reduced by £1 for every £2 of income over £100,000.
Take-home pay examples, 2026/27 and 2027/28
Because nothing changes, these figures apply to both tax years. Standard personal allowance, no pension contributions or student loan, England, Wales and Northern Ireland.
| Salary | Income tax | National Insurance | Take-home a year | A month |
|---|---|---|---|---|
| £30,000 | £3,486 | £1,394 | £25,120 | £2,093 |
| £40,000 | £5,486 | £2,194 | £32,320 | £2,693 |
| £50,000 | £7,486 | £2,994 | £39,520 | £3,293 |
| £60,000 | £11,432 | £3,211 | £45,357 | £3,780 |
| £75,000 | £17,432 | £3,511 | £54,057 | £4,505 |
| £100,000 | £27,432 | £4,011 | £68,557 | £5,713 |
| £125,000 | £42,432 | £4,511 | £78,057 | £6,505 |
| £150,000 | £53,703 | £5,011 | £91,286 | £7,607 |
Work out your own figures, with pension, student loan and Scottish rates, in the UK salary calculator.
What does change
- Savings income tax rises to 24% (basic), 44% (higher) and 49% (additional) from 6 April 2027.
- Dividend tax rises by two points to 10.75%, 35.75% and 39.35% from April 2027. The £500 dividend allowance is unchanged.
- National Living Wage rises 3.9%, from £12.71 to £13.21 an hour, from 1 April 2027.
- Business mileage: the 55p rate for the first 10,000 miles becomes permanent, and the rate above 10,000 miles rises from 25p to 35p from 6 April 2027.
- Pension allowances are unchanged: annual allowance £60,000, money purchase annual allowance £10,000.
- Pension salary sacrifice: the £2,000 a year cap on National Insurance savings, already law, starts in April 2029.
Scotland
Scottish income tax rates and bands for 2027/28 are set in the Scottish Budget on 3 December 2026. We will add them to this guide and the calculator once they are published. National Insurance is the same across the UK.
What the freeze means for finance professionals
With thresholds frozen until 2031, every pay rise you get is taxed at your top rate. If you earn close to £50,270, a rise can take part of your salary into the 40% band, and above £100,000 you start to lose your personal allowance. That makes benchmarking your salary, and negotiating the full package (pension, bonus and benefits), more important than a headline rise.
Frequently asked questions
Does the 2026 Budget change my take-home pay?
For most employees in England, Wales and Northern Ireland, no. Income tax rates, the £12,570 personal allowance, the tax bands and employee National Insurance are all unchanged for 2027/28 and frozen until April 2031.
Are income tax thresholds frozen?
Yes. The personal allowance stays at £12,570, the higher rate starts at £50,270 and the additional rate at £125,140, frozen until April 2031.
What changes in April 2027?
Savings income tax rises to 24%, 44% and 49%, dividend tax rises to 10.75%, 35.75% and 39.35%, and the National Living Wage rises from £12.71 to £13.21 an hour.
What about Scotland?
Scottish income tax rates for 2027/28 are set in the Scottish Budget on 3 December 2026. National Insurance is the same across the UK.
Is the salary sacrifice cap changing?
The £2,000 annual cap on National Insurance savings from pension salary sacrifice starts in April 2029, under the National Insurance Contributions Act 2026. This Budget did not change it.