2026: What is the 2026-20207 Personal Tax Allowance?
| Quick answer: | The standard personal allowance for the 2026/27 tax year is frozen at £12,750 and will remain at this until 2028. |
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| Quick answer: | The standard personal allowance for the 2026/27 tax year is frozen at £12,750 and will remain at this until 2028. |
Your Personal Allowance is the amount you can earn before you start paying Income Tax.
For most people, this is £12,570.
However, there’s an important detail that often gets missed. If your income goes above £100,000, your Personal Allowance starts to reduce. For every £2 you earn over £100,000, you lose £1 of your allowance. By the time your income reaches £125,140, your allowance is completely gone. This creates an effective higher tax rate in that band, which catches a lot of people off guard.
For most people in England, Wales and Northern Ireland, the Income Tax bands for the 2026/27 tax year (which runs from 6th April 2026 to 5th April 2027) are:
| Band | Taxable Income | Tax Rate |
| Personal allowance | Up to £12,570 | 0% tax |
| Basic rate | £12,571 to £50,270 | 20% tax |
| Higher rate | £50,271 to £125,140 | 40% tax |
| Additional rate | Over £125,140 | 45% tax |
These thresholds have been frozen for several years, which means more people are gradually being pulled into higher tax bands as earnings increase.
If you’re in Scotland, the tax bands are different:
| Band | Taxable Income | Scottish Tax Rate |
| Personal allowance | Up to £12,570 | 0% tax |
| Starter rate | £12,571 to £16,537 | 19% tax |
| Basic rate | £16,538 to £29,526 | 20% tax |
| Intermediate rate | £29,527 to £43,662 | 21% tax |
| Higher rate | £43,663 to £75,000 | 42% tax |
| Advanced rate | £75,001 to £125,140 | 45% tax |
| Top rate | Over £125,140 | 48% tax |
How tax bands actually work (this is where most people get confused)
One of the biggest misconceptions about UK tax is this:
People think that moving into a higher tax band means all of their income is taxed at that higher rate.
That’s not how it works. Instead, tax is applied in layers.
You’re entirely within the basic rate band, so everything above your allowance is taxed at 20%.
Only the portion above £50,270 is taxed at the higher rate.
This is why moving into a higher band doesn’t suddenly reduce your take-home pay dramatically. You only pay the higher rate on the income above that threshold.
No, the personal allowance is the same as 2025-26. In the most recent Budget the chancellor announced that a number of personal tax thresholds will be frozen until April 2028.
Your tax band depends on your total taxable income, not just your salary.
This can include:
For most PAYE workers:
If you’ve got more than one income source, things can get more complex, which is often where mistakes creep in.
Even when your tax is technically correct, it can still feel higher than expected.
There are a few common reasons for that:
A pay rise or bonus can push part of your income into the 40% band, which makes the increase feel smaller than expected.
If your tax code isn’t accurate, you could be paying more tax than you should.
This happens more often when:
Sometimes HMRC adjusts your tax code to recover tax from a previous year, which increases deductions.
Because tax bands have been frozen, more people are paying higher rates over time, even if their pay hasn’t increased dramatically in real terms.
If you’re employed, your tax is calculated automatically through PAYE.
Your employer:
The key point here is “based on the information they have”.
If anything is missing or outdated, PAYE can still take the wrong amount, and you may not notice straight away.
Yes, and it’s more common than people think.
You could be overpaying tax if:
HMRC doesn’t always automatically correct these situations, which means overpayments can sit there unless you actively check.
At a basic level, your tax should reflect:
If all of those line up, your PAYE deductions should be broadly accurate. But if any of them are off, even slightly, it can lead to overpaying or underpaying.
If you’re unsure whether your tax looks right, there are a few simple things worth checking:
If anything doesn’t quite add up, it’s worth digging into it properly.
Most people focus on how much tax they’re paying.
Far fewer check whether they’ve paid too much.
On average, a yearly tax refund can be worth around £750, and if you haven’t claimed before, you can usually go back up to four years, which could mean £3,000 or more.
That’s often where this topic becomes more than just informational. It becomes something worth acting on.
If your tax feels high, or you’ve never checked it properly, it’s worth taking a look. A quick check can give you a clearer picture of whether everything lines up, and whether there’s anything you’re missing.
RIFTPROD2 - Subscriber