Tax Rates & Allowances 2026/27
The tax year runs from 6 April 2026 to 5 April 2027. These headline figures are a starting point; reliefs and your circumstances can change the calculation. Income Tax bands shown are for England, Wales and Northern Ireland.
Checked against the linked GOV.UK sources on 15 September 2026. Recheck after fiscal announcements and before using figures for another tax year.
Income Tax: England, Wales & Northern Ireland
| Item | Rate or allowance |
|---|---|
| Personal Allowance before taper | £12,570 |
| Basic rate: first £37,700 of taxable income | 20% |
| Higher rate: taxable income over £37,700 to £125,140 | 40% |
| Additional rate: taxable income above £125,140 | 45% |
Taxable income is income after allowances. The Personal Allowance reduces by £1 for each £2 of adjusted net income over £100,000 and reaches zero at £125,140. Scottish bands differ.
GOV.UK sources: Income Tax rates and allowances.
National Insurance
| Item | Rate or allowance |
|---|---|
| Employee category A: earnings over £12,570 to £50,270 annually | 8% |
| Employee category A: earnings above £50,270 annually | 2% |
| Employer category A: earnings above £5,000 annually | 15% |
| Class 1A on taxable benefits | 15% |
| Self-employed Class 4: profits over £12,570 to £50,270 | 6% |
| Self-employed Class 4: profits above £50,270 | 2% |
These are annual thresholds. Ordinary payroll uses pay-period thresholds. Special NI categories and employer reliefs can change the amounts due.
GOV.UK sources: Employer rates; Self-employed NI.
Dividends, Savings & Other Allowances
| Item | Rate or allowance |
|---|---|
| Dividend allowance | £500 |
| Dividend tax: basic / higher / additional | 10.75% / 35.75% / 39.35% |
| Personal Savings Allowance: basic / higher / additional | £1,000 / £500 / £0 |
| Trading allowance, where eligible | £1,000 |
| Property allowance, where eligible | £1,000 |
| Adult ISA subscription allowance | £20,000 |
The dividend allowance still uses tax-band capacity. Trading and property allowances have eligibility conditions and generally replace expense deductions.
GOV.UK sources: Dividend tax; Savings interest; Trading and property allowances; ISAs.
VAT
| Item | Rate or allowance |
|---|---|
| Standard / reduced / zero rates | 20% / 5% / 0% |
| Registration threshold | £90,000 |
| Flat-rate scheme: limited cost business | 16.5% |
| Eligible first-year flat-rate reduction | 1 percentage point |
Registration tests include taxable turnover over the previous rolling twelve months and the expectation of exceeding the threshold in the next thirty days alone. Flat rates apply to VAT-inclusive turnover; other sector rates vary.
GOV.UK sources: VAT rates; Registration rules; Flat-rate rules.
Capital Gains Tax
| Item | Rate or allowance |
|---|---|
| Annual exempt amount: individual | £3,000 |
| Ordinary individual gains, including residential property | 18% / 24% |
The lower rate applies to gains within the unused basic-rate band. Special disposals and reliefs need separate calculations.
GOV.UK sources: CGT allowances; CGT rates.
Inheritance Tax
| Item | Rate or allowance |
|---|---|
| Nil-rate band | £325,000 |
| Residence nil-rate band, where eligible | Up to £175,000 |
| Standard estate tax rate | 40% |
| Residence band taper starts at net estate value | £2 million |
The residence band requires a qualifying home passing to direct descendants. It reduces by £1 for each £2 over the taper threshold. Transfers, lifetime gifts and reliefs can alter available allowances.
GOV.UK sources: Inheritance Tax; Residence band rules.
CIS & Company Cars
| Item | Rate or allowance |
|---|---|
| CIS: registered / unregistered / gross payment status | 20% / 30% / 0% |
| Car-fuel benefit multiplier | £29,200 |
CIS uses HMRC's verified status and excludes VAT and permitted costs. Car-fuel benefit uses the car's appropriate benefit percentage on the multiplier; electricity is not fuel for this charge.
GOV.UK sources: CIS deductions; 2026/27 fuel multiplier; Benefits and electricity guidance.
Corporation Tax
| Item | Rate or allowance |
|---|---|
| Small profits rate / main rate | 19% / 25% |
| Marginal relief lower / upper limits | £50,000 / £250,000 |
| Marginal relief standard fraction | 3/200 |
These rates apply to ordinary company profits from 1 April 2026. Limits reduce for short accounting periods and associated companies. The incorporation calculator assumes a twelve-month period, no associated companies and no exempt distributions.
GOV.UK sources: Corporation Tax rules; Rates and marginal relief fraction.
Put your figures in context
Use our tax and business calculators for a first estimate, or talk to us about your own position.