UK income tax bands for 2026-27 apply once your income goes above the £12,570 Personal Allowance. In England, Wales and Northern Ireland you pay 20% on the next £37,700 of taxable income, 40% on income up to £125,140 and 45% above that. Scotland has six bands, from 19% to 48%, which apply to wages and pensions. These rates cover 6 April 2026 to 5 April 2027 and are correct as of October 2026. The Autumn Budget on 28 October 2026 left the headline rates of income tax unchanged.
How UK income tax bands work
Income tax is charged in slices. Moving into a higher band does not mean all your income is taxed at the higher rate. Only the part that falls inside each band is taxed at that band’s rate. The tax year runs from 6 April to 5 April.
Take someone in England earning £40,000 who has the standard Personal Allowance. The first £12,570 is tax-free. The remaining £27,430 falls in the basic-rate band and is taxed at 20%, giving an income tax bill of £5,486 for the year. National Insurance is a separate charge and is not included here.
Income tax bands in England, Wales and Northern Ireland
According to GOV.UK, these are the 2026-27 bands for someone with the standard Personal Allowance:
- 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%
Wales has its own Welsh rates of income tax, which are collected by HMRC. For 2026-27, GOV.UK shows taxpayers in Wales on the same bands and rates as England and Northern Ireland. Scotland is the only nation listed with different bands.
The Personal Allowance taper above £100,000
Once your adjusted net income goes above £100,000, your Personal Allowance falls by £1 for every £2 of extra income. It disappears entirely at £125,140. This creates a steep effective rate in that range. Each extra £2 of income is taxed at 40%, and it also pulls £1 of previously tax-free allowance into tax at 40%. Together that works out at an effective 60% on income between £100,000 and £125,140.
Other allowances that can change your bill
Some people can claim extra allowances. HMRC’s 2026-27 tables list a Blind Person’s Allowance of £3,250. They also list a Married Couple’s Allowance, which only some couples can claim, ranging from £4,530 to £11,700. GOV.UK explains who qualifies for each. The examples in this guide assume the standard Personal Allowance only.
Scottish income tax bands for 2026-27
You pay Scottish income tax if you live in Scotland. The money goes to the Scottish Government. With the standard Personal Allowance, the 2026-27 bands are:
- 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%
Scottish rates apply to wages, pensions and most other taxable income. They do not apply to savings interest or dividends, which are taxed at the same rates as the rest of the UK.
On these bands, the same £40,000 salary produces an income tax bill of about £5,551 in Scotland, compared with £5,486 elsewhere in the UK. At higher incomes the gap widens, because Scotland’s 42% rate starts at £43,663 rather than £50,271.
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Tax on savings interest and dividends
Savings and dividend income have their own allowances, and these sit on top of the bands above.
Savings interest
- Starting rate for savings: up to £5,000 of interest taxed at 0%. It shrinks by £1 for every £1 of other income above your Personal Allowance, and you cannot use it once your other income reaches £17,570.
- Personal Savings Allowance: £1,000 of tax-free interest for basic-rate taxpayers, £500 for higher-rate taxpayers and nothing for additional-rate taxpayers.
- ISAs: interest earned inside an ISA does not usually count and is not taxed.
Dividends
HMRC’s rates and allowances tables set a £500 dividend allowance for 2026-27. Above that, dividends are taxed at 10.75% for basic-rate taxpayers, 35.75% for higher-rate taxpayers and 39.35% for additional-rate taxpayers.
What the Autumn Budget 2026 changed for income tax
Chancellor John Healey’s Budget on 28 October 2026 made no increase to the headline rates of income tax, National Insurance contributions or VAT. It did change several things that affect what some people will pay from April 2027.
- Savings and property income: Budget 2025 had already raised income tax rates on savings and property income by two percentage points across all bands from April 2027. The Budget 2026 document adds a further two points from the same date. MoneyWeek’s Budget coverage put the resulting rates at 24% basic, 44% higher and 49% additional. The Treasury says 84% of income tax payers will be unaffected.
- Pension Tax Allowance: from 6 April 2027, people above State Pension age whose total income is no more than the full new State Pension will not pay income tax on it. HM Treasury’s explainer says the allowance is applied automatically.
- Personal Allowance: the same explainer confirms the Personal Allowance stays at £12,570 in 2027-28.
- Cash ISAs: a planned cut to the cash ISA limit was dropped, so the limit stays at £20,000. That keeps a tax-free home available for savings interest.
How to check you are paying the right amount
Most employees and pensioners pay income tax through PAYE, with the amount set by their tax code. You can see your tax code and an estimate of this year’s bill in your HMRC personal tax account or the HMRC app. GOV.UK also has an “Estimate your Income Tax for the current year” service.
If your income changes, or you have savings interest above your allowances, it is worth checking that HMRC has the right figures. Banks and building societies tell HMRC how much interest they paid you after each tax year ends. Our earlier report on early Self Assessment filing shows how many people now deal with their returns as soon as the tax year closes.
Frequently asked questions
What are the UK income tax bands for 2026/27?
Outside Scotland they are 0% up to £12,570, 20% to £50,270, 40% to £125,140 and 45% above that. Scotland’s bands are 19%, 20%, 21%, 42%, 45% and 48%.
Do Scottish taxpayers pay different tax on savings?
No. Scottish rates apply to earnings and pensions. Savings interest and dividends are taxed at the same rates as the rest of the UK.
What is the 60% tax trap?
Between £100,000 and £125,140, the Personal Allowance is withdrawn at £1 for every £2 earned. Combined with the 40% rate, this gives an effective rate of 60% in that range.
Did the Autumn Budget 2026 raise income tax?
Headline income tax rates were unchanged. Tax rates on savings and property income rise by a further two percentage points from April 2027.
Is the Personal Allowance changing?
It is £12,570 in 2026-27, and Treasury guidance published with the Budget confirms it stays at £12,570 in 2027-28.
This article is general information, not financial or tax advice. Check GOV.UK or speak to a qualified adviser about your own position.
Sources: GOV.UK, Income Tax rates and Personal Allowances (accessed October 2026); HMRC, Income Tax rates and allowances for current and past years (updated 6 April 2026); GOV.UK, Scottish Income Tax (accessed October 2026); GOV.UK, Tax on savings interest (accessed October 2026); HM Treasury, Budget 2026 (28 October 2026); HM Treasury, Pension Tax Allowance explainer (28 October 2026); MoneyWeek, Autumn Budget live (28 October 2026).
