The 2026/27 UK tax year runs from 6 April 2026 to 5 April 2027. This guide summarises the rates confirmed by HMRC and the changes being consulted on. We'll update as the Autumn Budget 2025 and Spring Statement 2026 land — so check the "Updated" date at the top of this page.
Confirmed rates — 2026/27 vs 2025/26
| Threshold | 2025/26 | 2026/27 | Change |
|---|---|---|---|
| Personal Allowance | £12,570 | £12,570 | Frozen |
| Basic-rate threshold | £50,270 | £50,270 | Frozen |
| Additional-rate threshold | £125,140 | £125,140 | Frozen |
| ISA annual allowance | £20,000 | £20,000 | Unchanged |
| Pension annual allowance | £60,000 | £60,000 | Unchanged |
| Dividend Allowance | £500 | £500 | Unchanged |
| CGT Annual Exempt Amount | £3,000 | £3,000 | Unchanged |
| IHT nil-rate band | £325,000 | £325,000 | Frozen to 2030 |
| Residence nil-rate band | £175,000 | £175,000 | Frozen to 2030 |
The fiscal-drag freeze continues
The Personal Allowance and Income Tax thresholds remain frozen through to April 2028 at current levels. With typical earnings inflation of 4–5%, this drags an estimated 2 million more people into paying Income Tax and another 1.5 million into the higher-rate band by 2028 — without ever needing a rate change.
Changes landing in 2026/27
The following took effect or will take effect during 2026/27:
- Making Tax Digital (MTD) for Self Assessment starts April 2026 for sole traders and landlords with gross trading/rental income above £50,000. Quarterly digital submissions become mandatory.
- Inheritance Tax on pensions: from April 2027, unused pension pots will be brought inside the IHT net. Worth knowing now if you're planning estate structure for retirement.
- Furnished-holiday-let regime abolished from April 2025 (so already in effect for 2026/27 planning). FHL-specific CGT reliefs and pension-contribution status no longer apply.
- Non-dom regime replaced — the residence-based system is now in its second year; the 4-year Foreign Income and Gains regime applies to new arrivals from April 2025.
If you want the live effect of those changes on pay, use the Salary After Tax Calculator or the Income Tax Calculator and then compare against the 2025/26 guide.
Scottish bands — still not fully confirmed
Holyrood publishes Scottish bands at the Scottish Budget, typically December or January. 2026/27 Scottish bands are expected to follow the current six-band structure; check back after the 2025 Scottish Budget for confirmation.
Things to lock in before 5 April 2026
- Use your £20,000 ISA allowance — not carried over
- Use your £3,000 CGT Annual Exempt Amount — book gains you'd have made anyway
- Use your £500 Dividend Allowance if you have dividend income
- Maximise pension contributions — remember carry-forward from the prior 3 years
- If MTD will capture you, get compatible accounting software running now — you need a clean 2026/27 ledger from day one
Official sources and related reads
- 2025/26 tax year guide — compare the frozen thresholds side by side.
- UK tax code guide — useful if PAYE is the route most readers will feel first.
- GOV.UK: Making Tax Digital eligibility — the official MTD threshold page for landlords and sole traders.
- GOV.UK: Income Tax rates and allowances — the rates behind the PAYE calculator results.
- GOV.UK: Corporation Tax rates — useful if the 2026/27 plan includes a company structure.