UK Income Tax Rates 2025–2026 & 2024

INCOME TAX

Main personal allowances and reliefs

	2025/26	2024/25
Personal allowance*	£12,570	£12,570
Marriage/civil partners’ transferable allowance	£1,260	£1,260
Blind person’s allowance	£3,130	£3,070
Rent-a-room relief	£7,500	£7,500
Property allowance and trading allowance (each)	£1,000	£1,000

*Personal allowance reduced by £1 for every £2 of adjusted net income over £100,000

UK taxpayers excluding Scottish taxpayers – non-dividend, non-savings income

	2025/26	2024/25
20% basic rate on taxable income up to	£37,700	£37,700
40% higher rate on next slice of income over	£37,700	£37,700
45% additional rate on income over	£125,140	£125,140

Scottish taxpayers – non-dividend, non-savings income

	2025/26	2024/25
19% starter rate on income up to	£2,827	£2,306
20% basic rate on next slice up to	£14,921	£13,991
21% intermediate rate up to	£31,092	£31,092
42% higher rate up to	£62,430	£62,430
45% advanced rate up to	£125,140	£125,140
48% top rate on income over	£125,140	£125,140

All UK taxpayers

	2025/26	2024/25
Starting rate at 0% on savings income up to**	£5,000	£5,000
Personal savings allowance (Basic rate)	£1,000	£1,000
Personal savings allowance (Higher rate)	£500	£500
Personal savings allowance (Additional rate)	£0	£0
Dividend allowance	£500	£500

Tax rates on dividend income:

Basic rate: 8.75%
Higher rate: 33.75%
Additional rate: 39.35%

Trusts:

Income exemption: £500
Dividend rate: 39.35%
Other income: 45%

**Not available if taxable non-savings income exceeds the starting rate band

High Income Child Benefit Charge: 1% of benefit per £200 of adjusted net income between £60,000 and £80,000

Data from HMRC. Updated for the 2025–2026 tax year.

NATIONAL INSURANCE CONTRIBUTIONS

Class 1

	2025/26
NICs rate	Employee: 8% \| Employer: 15%
No NICs for employees generally on the first	£242 pw
No NICs for younger employees* on the first	£242 pw
NICs rate charged up to	£967 pw
2% NICs on earnings over	£967 pw

*No employer NICs on the first £967 pw for employees under 21, apprentices under 25 and veterans in first 12 months of civilian employment.
No employer NICs on the first £481 pw for employees at freeports and investment zones (first 36 months).

Employment allowance: £10,500 (not available if sole employee is a director)
Class 1A Employer: 15% on most employees’ and directors’ taxable benefits
Class 2 Self-employed: £3.50/week (£182.00 pa), Small profits threshold: £6,845
Class 3: Voluntary flat rate £17.75/week (£923.00 pa)
Class 4 Self-employed:
- £12,570 to £50,270: 6%
- Over £50,270: 2%

CAPITAL GAINS TAX

Annual exemption

	2025/26	2024/25
Individuals, estates, etc	£3,000	£3,000
Trusts generally	£1,500	£1,500

CGT Rates

Band	From 30/10/24	To 29/10/24
Below UK higher rate band	18%	10%
Surcharge (residential / carried interest)	0% / 0%	8% / 8%
Within higher/additional rate bands	24%	20%
Surcharge (residential / carried interest)	0% / 4%	4% / 8%
Trusts and estates	24%	20%

Business Asset Disposal Relief

14% (was 10%) on lifetime limit of £1,000,000 for trading businesses and companies
(minimum 5% participation, held ≥ 2 years)

*For 2025/26, carried interest CGT rate for all bands is 32%

INHERITANCE TAX

	2025/26	2024/25
Nil-rate band*	£325,000	£325,000
Residence nil-rate band*†	£175,000	£175,000
Rate of tax on excess	40%	40%
Rate if at least 10% of net estate left to charity	36%	36%
Lifetime transfers to and from certain trusts	20%	20%
Non-long-term-resident spouse /civil partner exemption	£325,000	£325,000

100% relief: businesses, unlisted/AIM companies, some farmland/buildings

50% relief: certain other business assets

Annual exempt gifts of: £3,000 per donor £250 per donee

Tapered tax charge on lifetime gifts between 3 and 7 years of death
Years 0–3 full 40% rate, then 8% less for each year until 0% at 7 or more years.

*Up to 100% of the unused proportion of a deceased spouse's/civil partner's nil-rate band and/or residence nil-rate band can be claimed on the survivor's death.
†Estates over £2,000,000: the value of the residence nil-rate band is reduced by 50% of the excess over £2,000,000.

STAMP DUTIES AND PROPERTY TRANSACTION TAXES

Stamp Duty and SDRT: Stocks and marketable securities 0.5%

Additional residential and all corporate residential properties
£40,000 or more – add 3% to SDLT rates, 2% to LTT and 4% to most LBTT rates

England & N Ireland — Stamp Duty Land Tax (SDLT) on slices of value from 1/4/25

Residential property	%	Commercial property¹	%
Up to £125,000	0	Up to £150,000	0
£125,001–£250,000	2	£150,001–£250,000	2
£250,001–£925,000	5	Over £250,000	5
£925,001–£1,500,000	10
Over £1,500,000	12

First time buyers: 0% on first £300,000 for properties up to £500,000

Non-resident purchasers: 2% surcharge on properties £40,000 or more

Residential properties bought by companies etc over £500,000: 17% of total consideration, subject to certain exemptions

¹10% for freeport and investment zone qualifying property in England only

Scotland — Land and Buildings Transaction Tax (LBTT) on slices of value

Residential property	%	Commercial property	%
Up to £145,000	0	Up to £150,000	0
£145,001–£250,000	2	£150,001–£250,000	1
£250,001–£325,000	5	Over £250,000	5
£325,001–£750,000	10
Over £750,000	12

First time buyers: 0% on the first £175,000

Wales — Land Transaction Tax (LTT) on slices of value

Residential property	%	Commercial property	%
Up to £225,000	0	Up to £225,000	0
£225,001–£400,000	6	£225,001–£250,000	1
£400,001–£750,000	7.5	£250,001–£1,000,000	5
£750,001–£1,500,000	10	Over £1,000,000	6
Over £1,500,000	12

CORPORATION TAX

Year to 31/3/26 and 31/3/25

Profits	Effective rate	Diverted profits
£0–£50,000	19.0%	31%
£50,001–£250,000	26.5%
£250,001 and above	25.0%

Loans to participants: 33.75% tax rate.

VALUE ADDED TAX

Standard rate	20%
Domestic fuel	5%
Installation of energy saving materials (except Northern Ireland)	0%
Registration level	£90,000
Deregistration	£88,000
Flat rate scheme turnover limit	£150,000
Cash and annual accounting schemes turnover limit	£1,350,000

CAR BENEFITS

Taxable amount based on original list price and CO₂ emissions in g/km.

Zero emission cars 3%

Petrol and diesel hybrids with CO₂ emissions 1—50g/km

Range — electric-only miles	< 30	30—39	40—69	70—129	130+
	15%	13%	9%	6%	3%

All non-diesel cars over 50g/km CO₂

51—54	55 & over
16%	17%*—37%

*Increased for every extra 5g/km by 1% up to the maximum 37%

Diesels not meeting RDE2: add 4% to non-diesel rates, up to 37%

Fuel benefit — taxable amount for private use

	2025/26	2024/25
CO₂ % charge used for car benefit multiplied by	£28,200	£27,800

VANS — FOR PRIVATE USE

	2025/26	2024/25
Zero emission: chargeable amount	Nil	Nil
Other vans: chargeable amount	£4,020	£3,960
Fuel: chargeable amount	£769	£757

TAX-FREE BUSINESS MILEAGE ALLOWANCE — OWN VEHICLE

Cars and vans first 10,000 miles	45p per mile	then 25p per mile
Qualifying passenger	5p per mile
Motorcycles	24p per mile	Bicycles 20p per mile

REGISTERED PENSIONS

	2025/26	2024/25
Lump sum and death benefit allowance	£1,073,100	£1,073,100
Lump sum allowance	£268,275	£268,275
Money purchase annual allowance	£10,000	£10,000
Annual allowance*	£60,000	£60,000
Annual allowance charge on excess is at applicable tax rate(s) on earnings

*Reduced by £1 for every £2 of adjusted income over £260,000 to a minimum of £10,000, subject to threshold income being over £200,000

STATE PENSIONS

	Annual	Weekly
New state pension	£11,973.00	£230.25
Basic state pension – single person*	£9,175.40	£176.45
Basic state pension – spouse/civil partner*	£5,496.40	£105.70

*State pension age reached before 6/4/16

TAX INCENTIVISED INVESTMENTS

	25/26	24/25
Total Individual Savings Account (ISA) limit, excluding Junior ISAs (JISAs)	£20,000	£20,000
Lifetime ISA	£4,000	£4,000
JISA/Child Trust Fund	£9,000	£9,000
Venture Capital Trust (VCT) at 30%	£200,000	£200,000
Enterprise Investment Scheme (EIS) at 30%*	£2,000,000	£2,000,000
EIS eligible for CGT deferral relief	No limit	No limit
Seed EIS (SEIS) at 50%	£200,000	£200,000
SEIS CGT reinvestment relief	50%	50%

*Above £1,000,000 investment must be in knowledge-intensive companies