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What Is the Personal Allowance for 2026/27?

Updated 2026/04/26 · HMRC-aligned for 2026/27

The personal allowance for 2026/27 remains frozen at £12,570 — but what does that actually mean for your wages, tax bill, and monthly take-home pay? Here's everything you need to know.

What Is the Personal Allowance for 2026/27?

The personal allowance for the 2026/27 tax year is £12,570. This is the amount of income you can earn completely free of Income Tax between 6 April 2026 and 5 April 2027. It applies to most UK residents automatically through your tax code — usually the standard 1257L code — and you don't need to claim it separately. The allowance has been frozen at £12,570 since April 2021, when the government announced a multi-year freeze as part of its fiscal strategy. While the number itself hasn't changed, the real-world effect is significant: as wages rise with inflation, more of your income falls into taxable bands — a process sometimes called 'fiscal drag.' In simple terms, even if your salary stays roughly the same in buying power, you may end up paying more tax in cash terms than you did a few years ago. For most employees in the UK, Income Tax only kicks in on earnings above £12,570. Everything up to that point is yours to keep — no Income Tax deducted. Above that threshold, you pay 20% Basic Rate tax on earnings up to £50,270, then 40% Higher Rate on income between £50,271 and £125,140, and finally 45% Additional Rate on anything above £125,140.

How the Personal Allowance Affects Different Earners

If you earn below £12,570 in 2026/27, you'll pay no Income Tax at all. This is useful to know if you work part-time, have multiple jobs with low hours, or receive income from savings and investments alongside a modest salary. If you earn between £12,570 and £50,270, you'll pay 20% tax only on the portion above your personal allowance. So on a salary of £30,000, you'd pay Basic Rate tax on £17,430 — not the full £30,000. Importantly, if your income exceeds £100,000, your personal allowance starts to reduce. For every £2 you earn over £100,000, you lose £1 of your allowance. By the time your income reaches £125,140, your personal allowance is reduced to zero, meaning you pay tax on every pound you earn. This creates an effective 60% marginal tax rate for income between £100,000 and £125,140 — one of the lesser-known quirks of the UK tax system. National Insurance contributions are calculated separately and have their own thresholds. For 2026/27, employees start paying 8% National Insurance on earnings above the Primary Threshold of £12,570 per year, meaning the personal allowance and NI threshold are currently aligned — though this hasn't always been the case historically.

Will the Personal Allowance Rise After 2026/27?

Under current government policy, the personal allowance is set to remain frozen at £12,570 until at least April 2028. After that, the expectation is that it will rise in line with inflation — but nothing has been confirmed officially beyond the freeze period. The freeze was first introduced by the Conservative government as a stealth tax measure and has been maintained since. For workers whose pay has increased even slightly over recent years, the cumulative effect of this freeze means a meaningfully higher proportion of their income is now taxable compared to 2021. If you're self-employed, a director, or have income from multiple sources — including rental income, dividends, or savings interest — the personal allowance still applies, but how it's allocated across those sources matters. It's worth checking your tax code each April to make sure HMRC has your allowance distributed correctly. Planning ahead is always worthwhile. Pension contributions, salary sacrifice schemes, and charitable giving through Gift Aid can all help reduce your adjusted net income and preserve your personal allowance — particularly if you're approaching the £100,000 taper zone.

Frequently asked questions

What is the personal allowance for 2026/27 in the UK?

The personal allowance for 2026/27 is £12,570. This is the amount of income you can earn before paying any Income Tax, and it applies automatically to most UK taxpayers through their tax code.

Has the personal allowance increased for 2026/27?

No. The personal allowance has been frozen at £12,570 since April 2021 and remains at the same level for 2026/27. It is currently expected to stay frozen until at least April 2028.

What happens to the personal allowance if I earn over £100,000?

If your income exceeds £100,000, your personal allowance reduces by £1 for every £2 earned above that level. At £125,140 or above, your personal allowance is zero and you pay Income Tax on all of your earnings.

Do I need to claim the personal allowance, or is it automatic?

For most employees, the personal allowance is applied automatically through your PAYE tax code (usually 1257L). You don't need to do anything to claim it, though you should check your tax code each year to make sure it's correct.

Is the personal allowance the same as the National Insurance threshold in 2026/27?

Yes, for 2026/27 both the personal allowance and the employee National Insurance Primary Threshold are aligned at £12,570 per year. This means you start paying both Income Tax and National Insurance at roughly the same earnings point, though they are calculated separately.