Has the Personal Allowance increased for 2026/27?

No. The Personal Allowance remains £12,570 and is now frozen until April 2031 — the Autumn Budget 2025 extended the existing freeze by three more years. The higher-rate threshold (£50,270) and additional-rate threshold (£125,140) are also frozen to April 2031.

Did National Insurance change for 2026/27?

No. Employee Class 1 NI remains at 8% on earnings between £12,570 and £50,270, and 2% above £50,270. Employer NI stays at 15% above the £5,000 secondary threshold. Employer thresholds are frozen until 2030/31.

What changed for Scottish taxpayers in 2026/27?

The Scottish Budget (January 2026) extended the Starter rate band limit to £16,537 (from £15,397) and the Basic rate band limit to £29,526 (from £27,491). Rates are unchanged — Starter 19%, Basic 20%, Intermediate 21%, Higher 42%, Advanced 45%, Top 48%. The Higher, Advanced and Top thresholds remain frozen.

Did dividend tax rates go up in 2026/27?

Yes. The Autumn Budget 2025 increased the basic and higher dividend rates by 2 percentage points from 6 April 2026. Basic rate is now 10.75% (was 8.75%), higher rate is 35.75% (was 33.75%), and the additional rate remains 39.35%. The £500 dividend allowance is unchanged.

What's new for Statutory Sick Pay in 2026/27?

Three major changes came into force on 6 April 2026: (1) the weekly rate increased to £123.25, or 80% of average weekly earnings if lower; (2) the Lower Earnings Limit was abolished so every employee qualifies regardless of income; and (3) the 3-day waiting period was removed so SSP is paid from day 1 of sickness.

What are the new student loan thresholds for 2026/27?

Plan 1: £26,900 (up from £26,065). Plan 2: £29,385 (up from £28,470). Plan 4 (Scotland): £33,795 (up from £32,745). Plan 5: £25,000 (unchanged — repayments began from April 2026). Postgraduate: £21,000 (unchanged). Repayment rates are 9% for Plans 1-5 and 6% for postgrad loans.

UK Tax Changes 2026/27: Complete Guide to New Rates & Thresholds

Key Changes at a Glance

What's staying the same

• Personal Allowance still £12,570
• Higher-rate threshold still £50,270
• Additional-rate threshold still £125,140
• Employee NI still 8% / 2%
• £500 dividend allowance unchanged
• £20,000 ISA allowance unchanged

What's changed

• Freeze extended another 3 years to April 2031
• Scottish Starter & Basic bands extended
• Dividend basic & higher rates +2pp
• SSP reform: day-1 pay, no LEL, £123.25/wk
• SMP up to £194.32/week
• Student loan thresholds raised (Plans 1, 2, 4)
• National Living Wage £12.71/hour (+4.1%)

Income Tax Rates 2026/27 (England, Wales & Northern Ireland)

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	£125,141+	45%

The big headline: the Autumn Budget 2025 extended the freeze on these thresholds for a further three years — they will now stay frozen until April 2031. With wages rising each year, more workers get dragged into higher bands without any change in real earnings. Read our breakdown of the £100k tax trap for how this hits six-figure earners especially hard.

Scottish Income Tax 2026/27

The Scottish Budget in January 2026 made modest but welcome changes: the Starter rate band limit was extended by 7.4% and the Basic rate band limit by 7.4% as well, meaning most Scottish taxpayers pay slightly less tax on the affected slice of income. Rates were held flat, and the Higher, Advanced and Top thresholds remain frozen.

Band	Taxable income	Rate
Personal Allowance	Up to £12,570	0%
Starter rate	£12,571 – £16,537	19%
Basic rate	£16,538 – £29,526	20%
Intermediate rate	£29,527 – £43,662	21%
Higher rate	£43,663 – £75,000	42%
Advanced rate	£75,001 – £125,140	45%
Top rate	£125,141+	48%

For a side-by-side comparison of Scottish and rest-of-UK tax bills at common salaries, see our Scottish tax vs English tax breakdown.

National Insurance 2026/27

Employee National Insurance rates and thresholds are unchanged from 2025/26. The main rate stays at 8% and the upper rate at 2%, with thresholds of £12,570 and £50,270.

Employee NI (Class 1)

Earnings	Rate
Up to £12,570	0%
£12,571 – £50,270	8%
£50,271+	2%

Employer NI also stays put: 15% above the £5,000 secondary threshold, with the £10,500 Employment Allowance unchanged. Employer thresholds are frozen until 2030/31. For the full rates tables, see GOV.UK: Rates and thresholds for employers 2026 to 2027.

Dividend Tax: The 2pp Rate Rise

The Autumn Budget 2025 announced an increase to the basic and higher rates of dividend tax from 6 April 2026. The additional rate and the £500 dividend allowance are unchanged. This change was primarily aimed at owner-managed companies where directors take a low salary plus dividends.

Band	2025/26	2026/27
Dividend allowance	£500 @ 0%	£500 @ 0%
Basic rate	8.75%	10.75%
Higher rate	33.75%	35.75%
Additional rate	39.35%	39.35%

Worked example: A higher-rate taxpayer receiving £10,000 of dividends now pays an extra £195 compared with 2025/26 (£9,500 taxable × 2pp). Ltd company directors taking £40,000 of dividends on top of a £12,570 salary see roughly £790 more tax. Model your own figures with our dividend tax calculator or read our full dividend tax guide.

Statutory Sick Pay: A Major Overhaul

2026/27 is the year SSP changes for real. Three reforms came into force on 6 April 2026 and, together, they give millions more workers access to sick pay.

1. Paid from day 1

The 3-day waiting period has been abolished. SSP now starts from your first qualifying day of sickness rather than the fourth. If you only need a day or two off, you still get paid.

2. No Lower Earnings Limit

Previously you had to earn at least £125/week to qualify at all. That threshold has been scrapped — every employee qualifies for SSP regardless of how much they earn, so part-time and low-paid workers are finally covered.

3. New rate: 80% of earnings or £123.25/week

The weekly rate is now the lower of £123.25 or 80% of your average weekly earnings. Higher earners get the cap, while low earners get 80% of their normal pay. The old flat-rate £118.75 is gone.

Work out what you'd receive with our SSP calculator, which supports both the old and new rules so you can compare. For a deeper dive into the policy change, see our SSP Changes 2026 guide.

Other Statutory Payments

Family-related statutory payments rose in line with annual upratings:

Statutory Maternity Pay (SMP): 90% of average weekly earnings for 6 weeks, then £194.32/week (up from £187.18) or 90% of earnings, whichever is lower, for up to 33 more weeks.
Statutory Paternity Pay, Shared Parental Pay, Adoption Pay, Parental Bereavement Pay: £194.32/week or 90% of earnings, whichever is lower.
Qualifying earnings threshold: £129/week (up from £125/week) for SMP/SPP/ShPP/SAP.

Full details and eligibility in our Maternity Pay Guide, and run your numbers with the SMP calculator.

Student Loan Thresholds 2026/27

Repayment thresholds for most plans rose in line with RPI, but the Plan 2 threshold is due to be frozen at its new level for three years from April 2027.

Plan	2025/26	2026/27	Rate
Plan 1 (pre-2012 Eng/Wal/NI)	£26,065	£26,900	9%
Plan 2 (2012-2023 Eng/Wal)	£28,470	£29,385	9%
Plan 4 (Scotland)	£32,745	£33,795	9%
Plan 5 (post-2023 Eng/Wal)	£25,000	£25,000	9%
Postgraduate loan	£21,000	£21,000	6%

Plan 5 repayments have started. If you took out an undergraduate loan in England or Wales for a course starting on or after 1 August 2023, you're on Plan 5, and repayments began from April 2026 once your income exceeds £25,000. For more detail see our Student Loan Repayment Guide.

National Living Wage: £12.71 from April 2026

The National Living Wage for workers aged 21+ rose by 4.1% on 1 April 2026 — from £12.21 to £12.71 per hour. Younger workers and apprentices also got above-inflation rises.

Age band	From April 2025	From April 2026	Change
21 and over (NLW)	£12.21	£12.71	+4.1%
18 – 20	£10.00	£10.85	+8.5%
16 – 17 / Apprentice	£7.55	£8.00	+6.0%

A full-time worker (37.5 hours/week) on the new NLW earns around £24,785/year. See our dedicated UK Minimum Wage 2026/27 guide for take-home breakdowns at every age band.

Fiscal Drag: The Stealth Tax Rise Continues

With rUK thresholds now frozen until April 2031, the real-terms tax burden continues to climb each year. Every pay rise that keeps up with inflation now pushes a larger slice of your income into the next band.

Example: a £48,000 earner in 2025/26

A 4% pay rise in April 2026 lifts them to £49,920 — still basic rate, no extra tax band.
Another 4% rise in April 2027 pushes them to £51,917 — now £1,647 of their income is taxed at 40% instead of 20%, costing an extra £329/year purely because the threshold didn't move.
If the freeze had ended in 2028 as originally planned, that extra tax would have been refunded via a higher threshold. Now it's baked in until 2031.

The OBR estimates the extended freeze will create around 1 million new higher-rate taxpayers by 2030/31 on top of those already affected. To model exactly how a pay rise affects you, try the pay rise calculator.

Tax Planning Tips for 2026/27

💰

Max out your pension

The annual allowance is still £60,000 (tapered above £260,000 adjusted income). Pension contributions cut your taxable income and are especially powerful for anyone near the £100k Personal Allowance taper. See our pension tax relief guide.

⚖️

Use salary sacrifice while you can

Salary sacrifice still saves both income tax and NI in 2026/27, though changes from April 2029 will cap the NI exemption at £2,000/year of pension contributions. Front-loading makes sense if you can afford it.

🏦

Use your £20,000 ISA allowance

The total ISA allowance is unchanged at £20,000. Note the £12,000 cash ISA limit takes effect from April 2027, so this is the last full tax year to put the entire £20,000 into a cash ISA if you're under 65.

💼

Review your dividend strategy

If you run a limited company, the 2pp dividend rate rise changes the salary-versus-dividend calculation. A slightly higher director's salary can now be more tax-efficient. Model both scenarios before the year-end.

👫

Marriage Allowance

If one of you earns below £12,570 and the other is a basic-rate taxpayer, transferring £1,260 of Personal Allowance saves up to £252/year. Claim backdated up to 4 years.

Calculate Your 2026/27 Take-Home Pay

See exactly how these changes hit your payslip with our free, private UK tax calculator — updated the moment the new rates took effect.

Try the Calculator →

Frequently Asked Questions

When does the 2026/27 tax year start?

The UK tax year runs from 6 April 2026 to 5 April 2027.

Has the Personal Allowance changed?

No. It stays at £12,570 and is now frozen until April 2031 — the Autumn Budget 2025 extended the existing freeze by a further three years. The higher-rate and additional-rate thresholds are also frozen until 2031.

What changed for Scottish taxpayers?

The Starter and Basic rate band limits were extended (to £16,537 and £29,526 respectively), giving most Scottish taxpayers a small cut compared with 2025/26. Rates are unchanged and the Higher, Advanced and Top thresholds remain frozen.

How much more will I pay in dividend tax?

A basic-rate shareholder pays an extra 2p in every £1 of dividends above the £500 allowance. A higher-rate shareholder pays the same 2pp increase. Additional-rate taxpayers are unaffected.

When did the new SSP rules start?

6 April 2026 — the start of the 2026/27 tax year. Paid from day 1, no Lower Earnings Limit, and the new rate is the lower of £123.25/week or 80% of average weekly earnings.

Are there still changes coming later?

Yes. The £12,000 cash ISA limit kicks in from April 2027 for under-65s. The £2,000 salary sacrifice NI cap starts from April 2029.

Staying Up to Date

All calculators on this site have been updated to reflect the 2026/27 rates. Historical years back to 2021/22 are still supported via the tax-year selector so you can check old payslips. Bookmark this page for a quick reference.

Disclaimer: This guide is for general information only and is not financial or tax advice. Rates and rules can change mid-year. Always refer to GOV.UK or a qualified adviser for decisions that depend on accuracy. Information accurate as of April 2026.

UK Tax Changes 2026/27: What You Need to Know