Income tax (England, Wales, NI)
- Personal allowance
- £12,570
- Tapered above
- £100,000
- Basic rate (20%)
- Up to £50,270
- Higher rate (40%)
- £50,271 to £125,140
- Additional rate (45%)
- Over £125,140
Tax rates
UK tax rates for 2026/27
The headline figures NI businesses and individuals need for the tax year running from 6 April 2026 to 5 April 2027. We update this page each April when new rates take effect.
Dividend tax
- Dividend allowance
- £500
- Basic rate
- 10.75% (was 8.75)
- Higher rate
- 35.75% (was 33.75)
- Additional rate
- 39.35%
National Insurance
- Employee main rate
- 8% (above primary threshold)
- Employee additional rate
- 2% (above UEL)
- Employer rate
- 15% (above secondary threshold)
- Primary threshold
- £12,570
- Secondary threshold
- £5,000
- Lower earnings limit
- £6,500
- Employment allowance
- £10,500
Class 4 NIC (self-employed)
- Main rate
- 6%
- Additional rate
- 2% (above UPL)
- Lower profits limit
- £12,570
- Upper profits limit
- £50,270
Corporation tax
- Small profits rate
- 19% (profits up to £50,000)
- Main rate
- 25% (profits over £250,000)
- Marginal relief band
- £50,001 to £250,000
- Effective marginal rate
- 26.5% in the relief band
Capital gains tax
- Annual exempt amount
- £3,000
- Non-residential (basic rate)
- 18%
- Non-residential (higher rate)
- 24%
- Residential (basic rate)
- 18%
- Residential (higher rate)
- 24%
- BADR rate
- 18% (was 14)
- BADR lifetime limit
- £1,000,000
Inheritance tax
- Nil rate band
- £325,000
- Residence nil rate band
- £175,000
- Rate above bands
- 40%
- BPR / APR 100% relief cap
- £1,000,000 per individual
- BPR / APR relief above cap
- 50%
VAT
- Standard rate
- 20%
- Reduced rate
- 5%
- Registration threshold
- £90,000 (rolling 12-month turnover)
- Deregistration threshold
- £88,000
Capital allowances
- Annual Investment Allowance
- £1,000,000 per year
- Structures & Buildings Allowance
- 3% per year (straight-line)
- Main pool
- 18% per year (reducing balance)
- Special rate pool
- 6% per year (reducing balance)
- Full expensing
- 100% in year one (companies, new plant and machinery)
Pension contributions
- Annual allowance
- £60,000 (or 100% of earnings if lower)
- Carry forward
- Unused allowance from the three previous tax years
Making Tax Digital for Income Tax
- Phase 1
- From April 2026: self-employment + property income over £50,000
- Phase 2
- From April 2027: income over £30,000
- Phase 3
- From April 2028: income over £20,000
Common questions about 2026/27 tax rates
What are the UK income tax rates and thresholds for 2026/27?
The personal allowance is £12,570. The basic rate of 20% applies up to £50,270, the higher rate of 40% from £50,271 to £125,140, and the additional rate of 45% above £125,140. These bands apply in England, Wales and Northern Ireland; Scotland sets its own.
What is the Class 4 National Insurance rate for the self-employed in 2026/27?
Class 4 NIC is charged at 6% on profits between £12,570 and £50,270, then 2% on profits above the upper profits limit.
What are the corporation tax rates for 2026/27?
The small profits rate is 19% on profits up to £50,000, and the main rate is 25% on profits over £250,000. Profits between the two attract marginal relief, an effective rate of 26.5% in that band.
What are the dividend tax rates for 2026/27?
The dividend allowance is £500. Above the allowance, dividends are taxed at 10.75% (basic rate), 35.75% (higher rate) and 39.35% (additional rate).
What is the VAT registration threshold for 2026/27?
The VAT registration threshold is £90,000 of rolling 12-month turnover, with a deregistration threshold of £88,000. The standard rate is 20%.
When does Making Tax Digital for Income Tax apply?
From April 2026 if your combined self-employment and property income exceeds £50,000, from April 2027 above £30,000, and from April 2028 above £20,000.
Figures sourced from gov.uk and HM Treasury budget documentation. Income tax bands shown apply in England, Wales and Northern Ireland; Scotland has its own bands. If you spot a number that looks out of date, please let us know — we update this page each April when the new rates take effect.
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