What was the headline change in the Autumn 2025 Budget for 2026/27?

The Autumn 2025 Budget kept Personal Allowance at £12,570, the higher-rate threshold at £50,270 and the additional-rate threshold at £125,140 for the 2026/27 tax year - extending the freeze that began in 2021/22. The Chancellor also confirmed the 8% employee National Insurance main rate and the 15% employer rate that took effect in April 2025 would remain in force, alongside the £5,000 employer Secondary Threshold.

Did the Personal Allowance change in 2026/27?

No - the Personal Allowance for 2026/27 stays at £12,570, the same level it has held since 6 April 2021. It still tapers by £1 for every £2 of adjusted net income above £100,000, fully withdrawn by £125,140. Because wages have risen with inflation while the allowance has not, more workers now pay 20% on a larger share of pay - the mechanic the OBR calls fiscal drag.

What are the UK income tax bands for 2026/27?

England, Wales and Northern Ireland: 0% Personal Allowance up to £12,570, 20% basic rate on the next £37,700 (so up to £50,270 of gross), 40% higher rate from £50,270 to £125,140, and 45% additional rate above £125,140. The bands are unchanged for the fifth consecutive year.

Did National Insurance rates change for 2026/27?

Rates were left in place for 2026/27 after the larger changes earlier in the cycle. Employee Class 1 main rate stays at 8% (cut from 12% in stages during 2024), the upper rate at 2% above the Upper Earnings Limit of £50,270, and the employer Class 1 secondary rate at 15% above the £5,000 Secondary Threshold (in force since 6 April 2025). Class 4 self-employed: 6% main rate, 2% upper rate.

What is the Dividend Allowance for 2026/27?

The Dividend Allowance for 2026/27 is £500 - the first £500 of dividend income is tax-free each tax year. Above the allowance, dividends are taxed at 8.75% (basic rate), 33.75% (higher rate) and 39.35% (additional rate). The allowance has been frozen at £500 since 6 April 2024 and was not changed in the Autumn 2025 Budget.

Did Capital Gains Tax rates change in the Autumn 2025 Budget?

CGT rates stayed at the post-October-2024 levels for 2026/27: 18% basic-rate and 24% higher / additional-rate on gains for all assets including residential property. The Annual Exempt Amount remained at £3,000, having been cut from £6,000 in 2023/24 and £12,300 in 2022/23. Business Asset Disposal Relief stays at 18% on the first £1m of lifetime qualifying gains, scheduled to rise to 24% from 6 April 2026 onwards.

Was the ISA allowance changed for 2026/27?

The total ISA allowance remained £20,000 for the 2026/27 tax year, with the Junior ISA limit at £9,000 and the Lifetime ISA at £4,000 (which counts toward the £20,000 cap). The Autumn 2025 Budget left these unchanged - the £20,000 limit has not moved since 2017/18.

Did the pension Annual Allowance change?

No - the standard pension Annual Allowance for 2026/27 stays at £60,000, the Money Purchase Annual Allowance (MPAA) remains £10,000, and the tapered allowance taper still kicks in for adjusted income above £260,000, withdrawing £1 for every £2 above the threshold down to a £10,000 floor.

What did the Budget do for Inheritance Tax?

Inheritance Tax thresholds remained frozen at the levels confirmed earlier in the cycle: Nil-Rate Band £325,000 and Residence Nil-Rate Band £175,000, both held until at least April 2030. The 40% headline rate (36% where 10% of the net estate is left to charity) is unchanged. The RNRB still tapers by £1 for every £2 the estate exceeds £2,000,000.

How are Scottish taxpayers affected for 2026/27?

Scotland sets its own income-tax bands above the UK-wide Personal Allowance. For 2026/27 the Scottish Budget widened the Starter rate band and the end of the Scottish basic rate band, leaving the six-band structure in place: 19% Starter (to £3,967 of taxable income), 20% basic (to £16,956), 21% intermediate (to £31,092), 42% higher (to £62,430), 45% advanced (to £112,570), and 48% top rate above £112,570. Scotland keeps the UK-wide National Insurance rates and Personal Allowance.

Were Stamp Duty thresholds changed?

No - SDLT thresholds for residential property in England and Northern Ireland stayed at the post-April-2025 reset: 0% to £125,000, 2% to £250,000, 5% to £925,000, 10% to £1.5m and 12% above. First-time-buyer relief: 0% to £300,000 then 5% to £500,000, withdrawn entirely above £500,000. The 5% additional-property surcharge introduced in October 2024 also remained in place.

Where can I see all the engine-verified figures?

Every monetary figure on this page is sourced from the same TaxRuleset that powers our salary calculator. The ruleset references the HMRC and gov.scot publications listed in the citations and on our methodology page. Run any of the 2026/27 numbers through the on-site calculator to reproduce them down to the band breakdown.

Budget 2026 Summary: What Changed for the 2026/27 Tax Year

The Autumn 2025 Budget was the Chancellor's set-piece announcement that shaped the rules now in force for the 2026/27 tax year. This page summarises every number that hit a UK payslip, dividend voucher, pension contribution or self-assessment return from 6 April 2026 - with figures drawn directly from the same TaxRuleset that powers our calculators.

Headline: what changed for 2026/27

The Autumn 2025 Budget delivered a "steady-as-she-goes" package rather than a structural overhaul. The political backdrop was the tail end of the previous government's freeze policy and the OBR's November 2025 fiscal outlook, both of which constrained how much headline change was on the table. The Chancellor opted to leave the core architecture intact: the £12,570 Personal Allowance, the £50,270 higher-rate threshold and the £125,140 additional-rate threshold all remain frozen, extending a policy that has now run for five consecutive tax years.

The headline arithmetic for 2026/27 therefore looks deceptively stable. Employee National Insurance stays at the 8% main rate and 2% upper rate. Employer NI remains at the 15% rate that took effect in April 2025, charged from a Secondary Threshold of just £5,000 - a sharp drop from the £9,100 ST that prevailed before April 2025. The Dividend Allowance held at £500, the ISA allowance at £20,000, the pension Annual Allowance at £60,000, and Capital Gains Tax stayed on the post-October-2024 schedule of 18% / 24% with a £3,000 Annual Exempt Amount. Inheritance Tax thresholds (£325,000 NRB, £175,000 RNRB) were extended in their frozen state to April 2030. The single visible movement on the personal-tax side was a modest widening of the Scottish Starter and basic-rate bands set by Holyrood at its own January 2026 budget event.

Personal Allowance and the frozen thresholds

The Personal Allowance for 2026/27 remains £12,570, unchanged from 2021/22. The higher-rate threshold - the income at which the 40% band starts - stays at £50,270 (£12,570 + £37,700 of basic-rate band). The additional-rate threshold above which 45% applies stays at £125,140, the same value as the point at which the £100,000 PA taper finishes withdrawing the allowance entirely.

The Personal Allowance taper itself is unchanged: PA reduces by £1 for every £2 of adjusted net income above £100,000, creating an effective marginal rate of 60% on Income Tax alone (62% with employee NI) on every pound earned between £100,000 and £125,140. The 60% trap is one of the few places in the UK system where the marginal rate is materially higher than the headline top rate - a side effect of the freeze that the Autumn 2025 Budget left entirely untouched.

The cumulative effect of the freeze - the fiscal drag - now bites at every income level. Compared against a counterfactual where the Personal Allowance had been uprated by CPI since 2021/22 (about a 23.7% cumulative uplift per the OBR's November 2025 forecast), a representative worker on £30,000 pays around £596 more income tax this year. The same drag costs a £45,000 worker about £596, an £60,000 earner around £2,542, and an £80,000 earner about £2,979. The increase falls on the full marginal £, not a tapered portion, so anyone whose pay rose by less than 23.7% over five years has lost real-terms income to the Treasury through this channel alone.

Income tax rates and bands (England, Wales, Northern Ireland)

The 2026/27 bands are identical to 2025/26. Income above the Personal Allowance is taxed at the rates shown below; the bands apply to taxable income, i.e. gross less PA.

Band	Taxable income	Equivalent gross	Rate
Personal Allowance	-	£0 - £12,570	0%
Basic rate	£0 - £37,700	£12,570 - £50,270	20%
Higher rate	£37,700 - £125,140	£50,270 - £137,710	40%
Additional rate	£125,140 - above	£137,710 - above	45%

The 40% band still covers everything from £50,270 of gross up to £125,140 - a span of £74,870 in which the marginal Income Tax rate is unchanged. The 45% additional rate continues to bite from £125,140, the same point at which the Personal Allowance fully tapers out, producing the curious geometry where the marginal rate falls from 62% (PA-taper band, with NI) down to 47% above £125,140.

National Insurance: settled rates

The cycle of NI changes that ran from late-2023 through April 2025 has now settled. The Autumn 2025 Budget made no further changes, and the 2026/27 rates are the same as 2025/26.

Employee Class 1 main rate: 8% on weekly earnings above the Primary Threshold of £12,570 (i.e. £242 a week / £1,048 a month) up to the Upper Earnings Limit of £50,270.
Employee Class 1 upper rate: 2% on earnings above the Upper Earnings Limit.
Employer Class 1 secondary rate: 15% on earnings above the £5,000 Secondary Threshold. The rate was raised from 13.8% and the ST cut from £9,100 with effect from 6 April 2025; both numbers continue into 2026/27.
Self-employed Class 4 main rate: 6% on profits between the Lower Profits Limit of £12,570 and the Upper Profits Limit of £50,270.
Self-employed Class 4 upper rate: 2% on profits above the UPL.
Self-employed Class 2: voluntary above the Small Profits Threshold of £7,105; weekly rate £3.65 for those topping up below the SPT.

Employer NIC remains the most expensive single line for businesses hiring. A £40,000 employee now generates roughly £5,250 in employer Class 1 NIC alone (15% on £40,000 minus £5,000 ST), on top of the cash wage. Where pay is structured through salary sacrifice (pension, cycle-to-work, EV lease) the employer also saves 15% NIC on the sacrificed amount - which has made sacrifice schemes materially more attractive to employers since the April 2025 rate rise.

Dividend allowance and rates

The Dividend Allowance for 2026/27 is £500 - unchanged from 2024/25 and 2025/26, having been cut sharply from £2,000 in 2023/24 and from £1,000 in the prior year. The Autumn 2025 Budget did not alter the allowance or the rates.

Ordinary rate (basic-rate band): 8.75%
Upper rate (higher-rate band): 33.75%
Additional rate (additional-rate band): 39.35%

Dividends do not attract National Insurance, which is still the structural reason a limited-company contractor outside IR35 takes home more than an equivalently-paid employee. The contractor calculator models the salary + dividend mix end-to-end. The combined corporate tax bite (Corporation Tax then personal dividend tax) on small-company profits is now around 26% for basic-rate shareholders, narrowing the gap versus employment income.

Capital Gains Tax

CGT rates for 2026/27 are unchanged from the schedule that took effect on 30 October 2024:

Basic-rate CGT: 18% on gains falling within the basic-rate Income Tax band.
Higher / Additional-rate CGT: 24% on gains above the basic-rate band - the same rate now applies to residential property as to shares and other assets.
Business Asset Disposal Relief (BADR): 18% on the first £1m of lifetime qualifying gains, scheduled to rise to 24% from 6 April 2026 onwards.
Annual Exempt Amount (AEA): £3,000 - the same level as 2024/25 and 2025/26, having been cut from £6,000 in 2023/24 and £12,300 in 2022/23.

The 24% top rate is materially higher than the 20% that applied to non-residential gains pre-October 2024, so disposals planned around that date should still be reviewed against the new bands. The £3,000 AEA is a fifth of its 2022/23 level, dragging far more retail investors into reporting - a small ETF rebalance or a buy-to-let disposal will now usually need to be reported on a Self Assessment return. See the CGT calculator for worked numbers across asset classes.

ISA and pension allowances

All three principal tax-advantaged savings vehicles kept their headline numbers for 2026/27:

ISA allowance: £20,000 (unchanged since 2017/18). Splittable across Cash, Stocks & Shares, Innovative Finance and Lifetime ISA in any combination, subject to the £4,000 LISA sub-limit.
Junior ISA: £9,000 per child per year.
Lifetime ISA: £4,000 (which counts toward the £20,000 total). 25% government bonus on contributions, used for first-home purchase or retirement from age 60.
Pension Annual Allowance (standard): £60,000 of total contributions across all pensions, employer and employee combined.
Tapered Annual Allowance: reduces by £1 for every £2 of adjusted income above £260,000, down to a £10,000 floor. Threshold income test at £200,000.
Money Purchase Annual Allowance (MPAA): £10,000 once a member has flexibly accessed a DC pension - this overrides the standard / tapered allowance for DC contributions.
Pension lump-sum allowance (LSA): £268,275 lifetime tax-free element.
Lump-sum and death benefit allowance (LSDBA): £1,073,100.

Carry-forward of unused Annual Allowance from the prior three tax years remains available, subject to having been a member of a UK-registered pension scheme during those years. The pension annual-allowance calculator models the taper and MPAA mechanics together.

VAT and duties

The headline VAT rate stays at 20%, with the reduced rate at 5% (domestic fuel and power, child car seats, energy-saving materials) and the zero rate on most food, books and children's clothing. The VAT registration threshold remained at £90,000 of taxable turnover (raised from £85,000 on 1 April 2024) with the deregistration threshold at £88,000.

Fuel duty on petrol and diesel was held at 52.95p per litre (the temporary 5p cut introduced in March 2022 was extended again, now scheduled to expire in March 2027). Alcohol duty moved on the standard RPI-linked uprating with effect from 1 February 2026; the underlying structure of the 2023 alcohol duty regime (rates by ABV strength) was unchanged. Tobacco duty rose 2% above RPI from 6pm on Budget day, the standard mechanism. Air Passenger Duty long-haul rates rose with forecast CPI.

Scotland: deviation from rest of UK

Scotland sets its own income-tax rates and bands above the UK-wide Personal Allowance through powers devolved in the Scotland Act 2016. National Insurance, Capital Gains Tax, dividend tax and savings tax remain UK-wide and are not devolved.

The Scottish Budget 2026-27 (published 13 January 2026) widened the Starter rate band and lifted the end of the Scottish basic rate band, leaving the six-band structure otherwise intact:

Band	Taxable income	Rate
Starter rate	£0 - £3,967	19%
Scottish basic rate	£3,967 - £16,956	20%
Intermediate rate	£16,956 - £31,092	21%
Higher rate	£31,092 - £62,430	42%
Advanced rate	£62,430 - £112,570	45%
Top rate	£112,570 - above	48%

The Scottish system continues to diverge sharply from rest of UK at higher incomes. Where rUK has a single 40% higher-rate band running from £50,270 to £125,140, Scotland has three bands (intermediate 21%, higher 42%, advanced 45%) and then a 48% top rate above £112,570 - a top rate three percentage points higher than rUK's 45%. The cliff edge between basic and higher rate sits at £43,662 of gross in Scotland (vs £50,270 in rUK), so a Scottish taxpayer earning £45,000 hits 42% marginal Income Tax on the slice between £43,662 and £45,000.

In cash terms, a £45,000 salary in 2026/27 produces take-home of around £35,920 in rUK and about £35,524 in Scotland - a gap of £396 a year. The gap widens further up the income scale. See the Scottish income tax guide for the full set of comparisons.

Stamp Duty / SDLT thresholds

Residential SDLT thresholds in England and Northern Ireland remained at the post-April-2025 reset, after the temporary thresholds raised in September 2022 were unwound. The Autumn 2025 Budget made no further changes.

0% on the slice up to £125,000.
2% from £125,001 to £250,000.
5% from £250,001 to £925,000.
10% from £925,001 to £1.5 million.
12% above £1.5 million.
First-time buyers: 0% to £300,000, 5% from £300,001 to £500,000. Relief withdrawn entirely above £500,000.
Additional-property surcharge: +5% on every band (in force since 31 October 2024).
Non-UK-resident surcharge: +2% on every band.

Scotland uses its own Land and Buildings Transaction Tax (LBTT, modelled in the LBTT calculator) and Wales uses Land Transaction Tax (LTT, see the LTT calculator). Neither was directly changed by the UK-government Budget.

Inheritance Tax

Inheritance Tax remained on the frozen schedule, with the Autumn 2025 Budget extending the freeze of the Nil-Rate Band and Residence Nil-Rate Band to at least April 2030.

Nil-Rate Band (NRB): £325,000 - the same level as 2009/10, when the band was last uprated. The freeze is now scheduled to run to April 2030.
Residence Nil-Rate Band (RNRB): £175,000 where a main residence passes to direct descendants. Also frozen to April 2030.
RNRB taper: reduces by £1 for every £2 the estate exceeds £2,000,000, so estates above £2.35m get no RNRB.
Spousal transfer: 100% of any unused NRB and RNRB transfers to the surviving spouse / civil partner, so a couple can effectively shelter £1m of estate where the residence-to-descendants criterion is met.
Headline rate: 40% on the taxable estate. Reduced to 36% where 10% or more of the net estate is left to charity.

Business Property Relief and Agricultural Property Relief were restructured under earlier Budget legislation: from 6 April 2026, BPR / APR is fully available only on the first £1 million of qualifying business or agricultural assets, with 50% relief on the value above £1m. Run a scenario through the Inheritance Tax calculator to see the combined NRB / RNRB / spousal-transfer arithmetic on a specific estate.

Worked example: a £45,000 worker, before and after

To anchor the page in a concrete payslip, consider a worker earning £45,000 gross in England in 2026/27. The salary engine returns these figures (and you can reproduce them directly via the on-site calculator):

Gross salary: £45,000
Personal Allowance: £12,570
Taxable income: £32,430
Income Tax (all in basic rate): £6,486
Employee Class 1 NI: £2,594
Total deductions: £9,080
Take-home (annual): £35,920
Take-home (monthly): £2,993
Effective tax + NI rate: 20.2%

Against the unfrozen-baseline counterfactual described earlier, the same £45,000 worker would have paid roughly £5,890 in Income Tax instead of £6,486 - a fiscal-drag cost of about £596 a year. Employer NIC on the same role is around £6,000 at the post-April-2025 15% rate (versus roughly £4,954 under the pre-April-2025 13.8% / £9,100 ST structure) - the headline employer-side change of the cycle, now embedded for 2026/27.

Run the same gross through the salary calculator to see the full band breakdown, or compare across tax years by changing the tax-year selector. Every figure on this page traces to the same TaxRuleset that feeds the on-site calculator, which in turn cites the gov.uk and gov.scot sources listed in the methodology page.

Frequently asked questions

What was the headline change in the Autumn 2025 Budget for 2026/27?: The Autumn 2025 Budget kept Personal Allowance at £12,570, the higher-rate threshold at £50,270 and the additional-rate threshold at £125,140 for the 2026/27 tax year - extending the freeze that began in 2021/22. The Chancellor also confirmed the 8% employee National Insurance main rate and the 15% employer rate that took effect in April 2025 would remain in force, alongside the £5,000 employer Secondary Threshold.
Did the Personal Allowance change in 2026/27?: No - the Personal Allowance for 2026/27 stays at £12,570, the same level it has held since 6 April 2021. It still tapers by £1 for every £2 of adjusted net income above £100,000, fully withdrawn by £125,140. Because wages have risen with inflation while the allowance has not, more workers now pay 20% on a larger share of pay - the mechanic the OBR calls fiscal drag.
What are the UK income tax bands for 2026/27?: England, Wales and Northern Ireland: 0% Personal Allowance up to £12,570, 20% basic rate on the next £37,700 (so up to £50,270 of gross), 40% higher rate from £50,270 to £125,140, and 45% additional rate above £125,140. The bands are unchanged for the fifth consecutive year.
Did National Insurance rates change for 2026/27?: Rates were left in place for 2026/27 after the larger changes earlier in the cycle. Employee Class 1 main rate stays at 8% (cut from 12% in stages during 2024), the upper rate at 2% above the Upper Earnings Limit of £50,270, and the employer Class 1 secondary rate at 15% above the £5,000 Secondary Threshold (in force since 6 April 2025). Class 4 self-employed: 6% main rate, 2% upper rate.
What is the Dividend Allowance for 2026/27?: The Dividend Allowance for 2026/27 is £500 - the first £500 of dividend income is tax-free each tax year. Above the allowance, dividends are taxed at 8.75% (basic rate), 33.75% (higher rate) and 39.35% (additional rate). The allowance has been frozen at £500 since 6 April 2024 and was not changed in the Autumn 2025 Budget.
Did Capital Gains Tax rates change in the Autumn 2025 Budget?: CGT rates stayed at the post-October-2024 levels for 2026/27: 18% basic-rate and 24% higher / additional-rate on gains for all assets including residential property. The Annual Exempt Amount remained at £3,000, having been cut from £6,000 in 2023/24 and £12,300 in 2022/23. Business Asset Disposal Relief stays at 18% on the first £1m of lifetime qualifying gains, scheduled to rise to 24% from 6 April 2026 onwards.
Was the ISA allowance changed for 2026/27?: The total ISA allowance remained £20,000 for the 2026/27 tax year, with the Junior ISA limit at £9,000 and the Lifetime ISA at £4,000 (which counts toward the £20,000 cap). The Autumn 2025 Budget left these unchanged - the £20,000 limit has not moved since 2017/18.
Did the pension Annual Allowance change?: No - the standard pension Annual Allowance for 2026/27 stays at £60,000, the Money Purchase Annual Allowance (MPAA) remains £10,000, and the tapered allowance taper still kicks in for adjusted income above £260,000, withdrawing £1 for every £2 above the threshold down to a £10,000 floor.
What did the Budget do for Inheritance Tax?: Inheritance Tax thresholds remained frozen at the levels confirmed earlier in the cycle: Nil-Rate Band £325,000 and Residence Nil-Rate Band £175,000, both held until at least April 2030. The 40% headline rate (36% where 10% of the net estate is left to charity) is unchanged. The RNRB still tapers by £1 for every £2 the estate exceeds £2,000,000.
How are Scottish taxpayers affected for 2026/27?: Scotland sets its own income-tax bands above the UK-wide Personal Allowance. For 2026/27 the Scottish Budget widened the Starter rate band and the end of the Scottish basic rate band, leaving the six-band structure in place: 19% Starter (to £3,967 of taxable income), 20% basic (to £16,956), 21% intermediate (to £31,092), 42% higher (to £62,430), 45% advanced (to £112,570), and 48% top rate above £112,570. Scotland keeps the UK-wide National Insurance rates and Personal Allowance.
Were Stamp Duty thresholds changed?: No - SDLT thresholds for residential property in England and Northern Ireland stayed at the post-April-2025 reset: 0% to £125,000, 2% to £250,000, 5% to £925,000, 10% to £1.5m and 12% above. First-time-buyer relief: 0% to £300,000 then 5% to £500,000, withdrawn entirely above £500,000. The 5% additional-property surcharge introduced in October 2024 also remained in place.
How much more income tax does a £30,000 worker pay vs an unfrozen baseline?: On a £30,000 salary the 2026/27 income tax bill is £3,486 compared with about £2,890 under a counterfactual where the Personal Allowance had been uprated by CPI since 2021/22 - a fiscal-drag cost of roughly £596 a year. The drag is more acute for higher earners: at £60,000 the gap is around £2,542.
Where can I see all the engine-verified figures?: Every monetary figure on this page is sourced from the same TaxRuleset that powers our salary calculator. The ruleset references the HMRC and gov.scot publications listed in the citations and on our methodology page. Run any of the 2026/27 numbers through the on-site calculator to reproduce them down to the band breakdown.