UK Income Tax Calculator 2026/27
Calculate your statutory UK income tax liability across England, Wales, Northern Ireland, and Scotland for the 2026/27 tax year. Fully models taxable employment earnings, self-employment profits, dividends, savings interest, and £100,000 personal allowance tapering.
Income & Tax Reliefs
HMRC & Scottish Government Statutory Rates (2026/27)
Calculation Breakdown
Salary, self-employment, dividends & savings
Standard 2026/27 allowance
Before National Insurance & student loans
•Tax Jurisdiction: England, Wales & Northern Ireland (Standard HMRC)
•Personal Allowance Applied: £12,570.00 tax-free.
•Pension Tax Relief: £2,500 gross contributions extended your basic rate threshold, saving higher rate tax.
How Your UK Income Tax Was Calculated (2026/27)
HMRC Standard England/Wales/NI Schedule • Total Gross Income: £55,000.00 • Adjusted Net Income: £52,500.00
Personal Allowance Allocation
£12,570.00 tax-freeFull statutory tax-free personal allowance applied: £12,570.00
You pay zero income tax on the first £12,570 of non-savings earnings.
Non-Savings Income Tax (rUK Standard Bands)
£8,932.00Taxable Non-Savings Earnings: £42,430.00
Basic Rate (20%): £40,200.00 × 20% = £8,040.00
Higher Rate (40%): £2,230.00 × 40% = £892.00
Total Non-Savings Tax: £8,932.00
Income is only taxed at the marginal rate applicable to each bracket.
£8,932.00
How this calculator works
How it works
- 01Aggregates all taxable income streams including employment PAYE salary, sole trader net profits, savings interest, and dividend earnings.
- 02Applies the standard statutory UK Personal Allowance of £12,570, tapering by £1 for every £2 earned above £100,000 adjusted net income (reaching £0 at £125,140).
- 03Extends basic rate tax bands for gross personal pension contributions (relief at source) and Gift Aid charitable donations.
- 04Applies regional income tax bands: England/Wales/NI (20% basic, 40% higher, 45% additional) or Scottish Government 6-tier rates (19% starter, 20% basic, 21% intermediate, 42% higher, 45% advanced, 48% top).
- 05Calculates savings interest tax considering the Personal Savings Allowance (£1,000 basic / £500 higher / £0 additional) and dividend tax after the £500 dividend allowance.
Tax rules that apply
- •Statutory Personal Allowance (£12,570): The standard tax-free allowance remains frozen at £12,570 across the UK through 2028. It is allocated across pay periods or deducted against net annual profits.
- •The £100,000 Personal Allowance Taper (60% Marginal Rate Trap): For every £2 of adjusted net income earned above £100,000, your personal allowance is reduced by £1. Once income reaches £125,140, personal allowance is zero. In this £100,000 to £125,140 band, you pay 40% higher rate tax plus lose 20% in lost allowance, creating an effective marginal rate of 60% (67.5% in Scotland).
- •Rest of UK Tax Bands: For England, Wales, and Northern Ireland, basic rate is 20% (£12,571 to £50,270), higher rate is 40% (£50,271 to £125,140), and additional rate is 45% (above £125,140).
- •Scottish Government Tax Bands: Devolved non-savings rates feature 6 bands: Starter (19%), Basic (20%), Intermediate (21%), Higher (42%), Advanced (45%), and Top (48% above £125,140). Savings and dividends remain taxed under UK-wide rates.
- •Dividend and Savings Allowances: Tax-free dividend allowance is £500, with surplus taxed at 8.75% (basic), 33.75% (higher), or 39.35% (additional). The Personal Savings Allowance is £1,000 for basic rate taxpayers, £500 for higher rate, and £0 for additional rate.
Current Tax Rates
| Tax / Deduction | Rate | Notes |
|---|---|---|
| UK Personal Allowance | £12,570 (0%) | Tapers £1 per £2 over £100,000 |
| rUK Basic Rate (20%) | £12,571 to £50,270 | Taxable pay up to £37,700 |
| rUK Higher Rate (40%) | £50,271 to £125,140 | Taxable pay up to £112,570 |
| rUK Additional Rate (45%) | Over £125,140 | Highest federal tier |
| Scottish Starter & Basic | 19% & 20% | £12,571 to £26,561 |
| Scottish Intermediate & Higher | 21% & 42% | £26,562 to £75,000 |
| Scottish Advanced & Top | 45% & 48% | £75,001 to £125,140+ |
| Dividend Allowance | £500 tax-free | 8.75% basic / 33.75% higher / 39.35% top |
| Personal Savings Allowance | £1,000 / £500 / £0 | Basic / Higher / Additional |
What this calculator assumes
- Reflects HMRC and Scottish Government statutory rates and thresholds for the 2026/27 tax year.
- Assumes adjusted net income calculation accurately reflects allowable pension contributions and Gift Aid declarations.
- Dividend and savings tax calculations assume employment and trading income use the Personal Allowance first under standard HMRC ordering rules.
Where our numbers come from
These calculators are based on official government tax rates and rules. We link directly to the source so you can verify everything yourself.
HMRC — Employer Tax Rates & Thresholds 2025–2026
HM Revenue & Customs, United Kingdom
HMRC — Income Tax & National Insurance Rates 2026/27
HM Revenue & Customs (HMRC)
Scottish Government — Scottish Income Tax Rates and Bands 2026/27
The Scottish Government (Riaghaltas na h-Alba)
Frequently Asked Questions
How is UK income tax calculated for the 2026/27 tax year?
UK income tax is calculated by summing your taxable earnings (salary, self-employment profits, rental income, savings interest, and dividends), deducting your Personal Allowance (£12,570 if your income is below £100,000), and applying the statutory marginal tax brackets. In England, Wales, and Northern Ireland, earnings between £12,571 and £50,270 are taxed at 20% (basic rate), earnings from £50,271 to £125,140 are taxed at 40% (higher rate), and earnings over £125,140 are taxed at 45% (additional rate).
What is the £100,000 income tax trap and 60% marginal rate?
When your adjusted net income exceeds £100,000, your £12,570 Personal Allowance is reduced by £1 for every £2 of income above £100,000. This taper means that between £100,000 and £125,140, an extra £100 of income incurs £40 of higher rate tax plus an additional £20 of tax due to losing £50 of your tax-free allowance. This results in an effective marginal tax rate of 60% (excluding National Insurance and student loans).
How do Scottish income tax bands differ from England and Wales?
The Scottish Parliament sets devolved income tax rates on non-savings non-dividend income for Scottish tax residents (prefix S). Scotland features a 6-tier system: Starter Rate (19% on £12,571–£14,876), Basic Rate (20% on £14,877–£26,561), Intermediate Rate (21% on £26,562–£43,662), Higher Rate (42% on £43,663–£75,000), Advanced Rate (45% on £75,001–£125,140), and Top Rate (48% over £125,140). Savings and dividends remain taxed under rUK rates.
How do pension contributions reduce my UK income tax bill?
Pension contributions provide significant tax relief. Under 'relief at source' schemes (such as personal pensions or SIPPs), your pension provider automatically claims basic rate (20%) tax relief. If you are a higher rate (40%) or additional rate (45%) taxpayer, pension contributions extend your basic rate tax band, allowing you to reclaim an additional 20% to 25% tax relief via your Self Assessment tax return or PAYE tax code adjustment. Under 'salary sacrifice' or net pay arrangements, pension payments are deducted before tax, immediately lowering your taxable gross pay.
How are dividend income and bank savings interest taxed in the UK?
In the 2026/27 tax year, you receive a tax-free Dividend Allowance of £500. Dividends above £500 are taxed at 8.75% for basic rate taxpayers, 33.75% for higher rate taxpayers, and 39.35% for additional rate taxpayers. Bank interest is covered by the Personal Savings Allowance (PSA): basic rate taxpayers can earn £1,000 in interest tax-free, higher rate taxpayers £500, while additional rate taxpayers receive £0.
When is UK income tax deducted via PAYE versus paid through Self Assessment?
If you are an employee or company director, income tax is automatically deducted from your wage packet each month by your employer under the Pay As You Earn (PAYE) system. However, you must file a Self Assessment tax return by 31 January if your income exceeds £150,000, you have untaxed self-employment profits over £1,000, untaxed dividend income over £10,000, rental property profits, or if you need to pay the High Income Child Benefit Charge.
