The basic rate income tax threshold in the United Kingdom covers taxable earnings from £12,571 to £50,270 for the 2026-27 tax year, with a flat 20% rate applied to every pound in that range. Below £12,571 you pay nothing, thanks to the Personal Allowance. Above £50,270 you enter the higher rate band at 40%. These figures have been frozen since April 2022 and, following the Autumn Budget 2025, will stay put until April 2031.1House of Commons Library. Fiscal Drag: An Explainer
How the 20% Rate Actually Applies
The band itself is £37,700 wide. That figure, called the basic rate limit, is the amount of taxable income that gets charged at 20% before you cross into higher-rate territory. Add it to the £12,570 Personal Allowance and you arrive at the £50,270 upper threshold.2GOV.UK. Income Tax Personal Allowance and the Basic Rate Limit From 6 April 2026 to 5 April 2028
Take someone earning £30,000. The first £12,570 is tax-free. The remaining £17,430 sits inside the basic rate band, so 20% applies, giving a bill of £3,486. Nothing is taxed at 40% because total earnings are well under £50,270.
The system is progressive. Crossing into a higher band only affects the pounds actually in that band. A £55,000 salary doesn’t mean 40% on everything — only the £4,730 above £50,270 gets the higher rate; the slice between £12,571 and £50,270 is still taxed at 20%.
If you’re employed, HMRC collects the tax through Pay As You Earn and your tax code handles the allowance automatically. Self-employed earners and anyone with untaxed income report through Self Assessment.3GOV.UK. Self Assessment Tax Returns
What Sits Below and Above the Basic Rate
The £12,570 floor is the Personal Allowance — income you can earn each tax year before any income tax is due.2GOV.UK. Income Tax Personal Allowance and the Basic Rate Limit From 6 April 2026 to 5 April 2028 It applies to nearly all UK residents and is built into your PAYE tax code, so most employees never touch it directly.
Above the basic rate band, earnings from £50,271 to £125,140 are taxed at 40%, and anything over £125,140 hits the 45% additional rate.4GOV.UK. Income Tax Rates and Personal Allowances
Why the Frozen Threshold Matters
Because both the £12,570 allowance and the £50,270 upper threshold have been held still since April 2022, wages that rise with inflation push people deeper into tax without any rate change. The Institute-style term for this is fiscal drag, and it’s the reason many workers who sat comfortably in the basic rate band a few years ago now find themselves paying 40% on part of their income.1House of Commons Library. Fiscal Drag: An Explainer
If your salary has moved much since 2022, it’s worth checking whether your taxable income has quietly crept over £50,270. That’s the point where the extra pounds start costing 40p each rather than 20p.
Ways to Shift Where the Threshold Bites
Marriage Allowance
If one spouse or civil partner earns under £12,570, they can transfer £1,260 of their unused Personal Allowance to the other, provided the recipient earns no more than £50,270. The recipient’s tax-free amount rises to £13,830 and the couple saves up to £252 a year. In Scotland, the recipient must be a starter, basic, or intermediate rate taxpayer, so the ceiling is £43,662 instead.5GOV.UK. Marriage Allowance
Blind Person’s Allowance
If you’re registered as severely sight impaired, Blind Person’s Allowance adds £3,250 to your tax-free income for 2026-27.6GOV.UK. Blind Person’s Allowance It isn’t applied automatically. You need to claim it, and any part you can’t use yourself can be transferred to a spouse or civil partner.
Pension Contributions and Gift Aid
Pension contributions reduce the income counted against the threshold. Through a relief-at-source scheme, the provider adds 20% automatically. If you pay 40% tax, you can claim the extra 20% through Self Assessment, so the portion of income redirected into a pension is effectively taxed at 20% instead of 40%.7GOV.UK. Tax on Your Private Pension Contributions – Tax Relief Someone earning £55,000 who pays £5,000 into a pension picks up £1,000 in higher-rate relief on top of what the scheme already claims.
Gift Aid works the same way. The charity reclaims the basic rate on your donation, and higher-rate taxpayers can reclaim the difference between 20% and 40% via Self Assessment.8GOV.UK. Tax Relief When You Donate to a Charity – Gift Aid Both mechanisms can pull income that would otherwise be taxed at 40% back into the basic rate zone.
If You Live in Scotland, the Threshold Is Different
Scottish residents keep the same £12,570 Personal Allowance, but the bands above it are set by the Scottish Government and don’t line up with the rest of the UK. For 2026-27:9Scottish Government. Scottish Income Tax 2026 to 2027 – Technical Factsheet
- Starter rate 19% — £12,571 to £16,537
- Basic rate 20% — £16,538 to £29,526
- Intermediate rate 21% — £29,527 to £43,662
- Higher rate 42% — £43,663 to £75,000
- Advanced rate 45% — £75,001 to £125,140
- Top rate 48% — over £125,140
The Scottish basic rate covers a much narrower slice of income. A Scottish taxpayer on £30,000 pays 19% on a small starter band and hits the 21% intermediate rate long before an English taxpayer would leave the 20% band. At £55,000, a Scottish earner faces 42% on the top slice while an English earner pays 40% on the same money.
Other Thresholds That Interact With the Basic Rate
The Personal Allowance Taper at £100,000
Once adjusted net income passes £100,000, the Personal Allowance drops by £1 for every £2 above the limit. At £125,140, the whole £12,570 is gone.10GOV.UK. Personal Allowances – Adjusted Net Income Between those two figures, the effective marginal rate reaches 60%: you pay 40% on the extra income and lose £1 of tax-free allowance for every £2 earned, which was previously shielding income from 40%. Pension contributions that keep adjusted net income below £100,000 preserve the full allowance.
The High Income Child Benefit Charge
If a household claims Child Benefit and either parent earns over £60,000, the higher earner must pay some of it back through the High Income Child Benefit Charge — 1% of the benefit for every £200 of income above £60,000, with full repayment at £80,000.11GOV.UK. High Income Child Benefit Charge It’s collected through Self Assessment, so it can apply even when the rest of your income is handled by PAYE.