💰 Income Tax Calculator 2026/27
Tax Band Breakdown
| Band | Income in Band | Rate | Tax |
|---|
Explore All Free UK Tax Calculators
16 specialist tools updated for HMRC 2026/27 rates — calculate tax, National Insurance, savings and deductions instantly.
📖 How UK Income Tax Works in 2026/27
Income tax is the largest tax most UK workers pay. It is collected by HMRC on your earnings from employment, self-employment, pensions and certain investment income. The amount you owe depends on how much you earn and which tax band your income falls into.
The Personal Allowance
Everyone in the UK gets a tax-free Personal Allowance of £12,570 for the 2026/27 tax year. This means the first £12,570 of your annual income is not subject to income tax. However, if you earn more than £100,000, your Personal Allowance is reduced by £1 for every £2 above that threshold. Once your income reaches £125,140, the allowance is eliminated entirely — a phenomenon known as the “60% tax trap”.
How Tax Bands Work
Income tax in England, Wales and Northern Ireland is charged in progressive bands. Only the portion of your income within each band is taxed at that band’s rate. For example, if you earn £60,000, you do not pay 40% on the entire amount — you pay 0% on the first £12,570, 20% on the next £37,700, and 40% only on the remaining £9,730.
National Insurance Contributions
On top of income tax, most employees pay Class 1 National Insurance. For 2026/27, the main rate is 8% on earnings between £12,570 and £50,270 per year, and 2% on anything above £50,270. NI contributions build your entitlement to the State Pension and certain benefits such as Jobseeker’s Allowance.
Pension Contributions and Tax Relief
Pension contributions made through salary sacrifice reduce your gross pay before tax and NI are calculated, meaning you save on both. If your pension uses relief-at-source, your provider claims basic rate tax relief automatically. Higher and additional rate taxpayers can reclaim the extra relief via Self Assessment.
Student Loan Repayments
Student loan repayments are not a tax, but they are deducted from your salary alongside PAYE. The amount depends on which plan you are on and whether you earn above the repayment threshold. Plan 2 (most English and Welsh graduates since 2012) has a threshold of £28,470, with 9% deducted on earnings above that. Postgraduate Loans are charged at 6% above a £21,000 threshold.
💲 Income Tax Bands 2026/27
England, Wales & Northern Ireland income tax rates and thresholds.
| Band | Taxable Income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Basic Rate | £12,571 – £50,270 | 20% |
| Higher Rate | £50,271 – £125,140 | 40% |
| Additional Rate | Over £125,140 | 45% |
🏴 Scottish Income Tax Bands 2026/27
Scotland has its own six-band income tax structure for non-savings, non-dividend income.
| Band | Taxable Income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Starter Rate | £12,571 – £14,876 | 19% |
| Basic Rate | £14,877 – £26,561 | 20% |
| Intermediate Rate | £26,562 – £43,662 | 21% |
| Higher Rate | £43,663 – £75,000 | 42% |
| Advanced Rate | £75,001 – £125,140 | 45% |
| Top Rate | Over £125,140 | 48% |
❓ Frequently Asked Questions
Quick answers to common UK income tax questions for 2026/27.
UK income tax is calculated in progressive bands. You receive a tax-free Personal Allowance of £12,570, then pay 20% on income from £12,571 to £50,270 (Basic Rate), 40% from £50,271 to £125,140 (Higher Rate), and 45% on income above £125,140 (Additional Rate). Only the portion of your income within each band is taxed at that rate — not your entire salary.
Both are deducted from your salary, but they serve different purposes. Income tax funds general government expenditure, while National Insurance contributions build your entitlement to the State Pension and certain benefits. For 2026/27, employees pay 8% NI on earnings between £12,570 and £50,270, and 2% above £50,270. They have different thresholds and rates, so the amounts differ.
Pension contributions reduce your taxable income, meaning you pay less income tax and, with salary sacrifice arrangements, less National Insurance too. For example, if you earn £50,000 and contribute 5% (£2,500) via salary sacrifice, you are only taxed on £47,500. This makes pension saving one of the most tax-efficient ways to build retirement wealth.
Scotland has six income tax bands: Starter Rate 19% (£12,571–£14,876), Basic Rate 20% (£14,877–£26,561), Intermediate Rate 21% (£26,562–£43,662), Higher Rate 42% (£43,663–£75,000), Advanced Rate 45% (£75,001–£125,140), and Top Rate 48% (above £125,140). Scottish taxpayers have tax codes starting with “S”. National Insurance is the same UK-wide.
Student loan repayments are separate from income tax. They are collected through PAYE once your income exceeds the repayment threshold for your plan. Plan 1: 9% above £24,990; Plan 2: 9% above £28,470; Plan 4: 9% above £31,395; Plan 5: 9% above £25,000; Postgraduate Loan: 6% above £21,000. You can have both an undergraduate and postgraduate loan deducted simultaneously.
The 60% tax trap affects earners between £100,000 and £125,140. In this range, your Personal Allowance is withdrawn by £1 for every £2 earned above £100,000, creating an effective marginal rate of 60% (40% income tax plus 20% lost allowance). The most common way to avoid it is to make pension contributions that bring your adjusted net income below £100,000. Gift Aid donations can also help.