England, Wales and Northern Ireland
These bands apply to your total taxable income, including salary, self-employed profits and most pensions. Wales can set its own rates but currently matches England.
| Rate | Band | Taxable income |
|---|---|---|
| 0% | Personal Allowance | Up to £12,570 |
| 20% | Basic rate | £12,571 – £50,270 |
| 40% | Higher rate | £50,271 – £125,140 |
| 45% | Additional rate | Over £125,140 |
Scotland
Scottish taxpayers pay Scottish Income Tax on earnings. Savings and dividend income still use UK rates.
| Rate | Band | Taxable income |
|---|---|---|
| 0% | Personal Allowance | Up to £12,570 |
| 19% | Starter rate | £12,571 – £16,537 |
| 20% | Basic rate | £16,538 – £29,526 |
| 21% | Intermediate rate | £29,527 – £43,662 |
| 42% | Higher rate | £43,663 – £75,000 |
| 45% | Advanced rate | £75,001 – £125,140 |
| 48% | Top rate | Over £125,140 |
The Personal Allowance
The Personal Allowance is the amount you can earn before paying Income Tax: £12,570 in 2026/27. It has been frozen for several years, so more of every pay rise falls into tax ("fiscal drag").
Above £100,000, the allowance falls by £1 for every £2 of income, and disappears completely at £125,140. This creates an effective 60% Income Tax rate in that range.
How much Income Tax you pay: examples
Income Tax only (National Insurance not included), for a salary with no pension contributions:
| Salary | England, Wales & NI | Scotland | Difference |
|---|---|---|---|
| £20,000 | £1,486 | £1,446 | £-40 |
| £25,000 | £2,486 | £2,446 | £-40 |
| £30,000 | £3,486 | £3,451 | £-35 |
| £35,000 | £4,486 | £4,501 | £15 |
| £40,000 | £5,486 | £5,551 | £65 |
| £50,000 | £7,486 | £8,982 | £1,496 |
| £60,000 | £11,432 | £13,182 | £1,750 |
| £75,000 | £17,432 | £19,482 | £2,050 |
| £100,000 | £27,432 | £30,732 | £3,300 |
| £125,000 | £42,432 | £47,607 | £5,175 |
| £150,000 | £53,703 | £59,634 | £5,931 |
Worked example: £40,000
- Taxable income: £40,000 − £12,570 = £27,430
- Income Tax: 20% × £27,430 = £5,486
- National Insurance: 8% × (£40,000 − £12,570) = £2,194
- Take-home pay: £32,320 a year, £2,693 a month
Tax codes explained
- 1257L is the standard code: you get the £12,570 Personal Allowance, spread across the year.
- S1257L and C1257L mean you pay Scottish or Welsh rates.
- BR, D0 and D1 tax all income at the basic, higher or additional rate, usually for a second job.
- K codes mean you have untaxed income or benefits worth more than your allowance.
- W1, M1 or X after a code is an emergency basis: each payday is taxed on its own until HMRC updates your code.
Savings and dividend income
Interest from savings is covered by the Personal Savings Allowance: £1,000 for basic-rate taxpayers and £500 for higher-rate taxpayers (none for additional-rate). Some people on low incomes also get a starting rate for savings of up to £5,000.
Dividends have a £500 allowance, then are taxed at 8.75%, 33.75% or 39.35% depending on your band. Money in ISAs is tax-free.
Frequently asked questions
What are the Income Tax rates for 2026/27?
0% up to £12,570, 20% up to £50,270, 40% up to £125,140 and 45% above, in England, Wales and Northern Ireland.
Is Income Tax higher in Scotland?
Scotland pays slightly less on low incomes (19% starter rate) but more from about £30,000, with rates of 21%, 42%, 45% and 48%.
How much can I earn before paying tax?
£12,570 a year, unless your income is above £100,000.
Is National Insurance included in these rates?
No. National Insurance is charged separately: 8% between £12,570 and £50,270 and 2% above.
What does tax code 1257L mean?
It means you get the standard £12,570 Personal Allowance.
Do I pay tax on savings interest?
Only above your Personal Savings Allowance: £1,000 for basic-rate and £500 for higher-rate taxpayers. ISA interest is always tax-free.
Figures use HMRC 2026/27 Income Tax bands (including Scottish rates), Class 1 National Insurance and student loan thresholds for an employee paid through PAYE. Read our methodology. Last updated September 25, 2026. Estimates for information only, not tax advice.