UK Tax Bands Explained: The Main 2026/27 Thresholds
For 2026/27, the main UK income tax thresholds are a £12,570 Personal Allowance, 20% basic rate up to £50,270, 40% higher rate up to £125,140 and 45% additional rate above that. This page explains how those bands affect real take-home pay.
Compare uses your current True Wage inputs for both salaries (same commute/cost assumptions).
£
Estimated using your current salary + tax year + region.
Bonus is taxed at your marginal rates (illustrative).
Bonus after tax (estimate)▼
Item
Amount
Net bonus
£—
Note: This is an illustrative estimate. Payroll can withhold differently depending on pay period and coding.
Illustrative estimate onlyResults are indicative. Check payslips or payroll information for final deductions.
UK tax bands explained (2026/27)
The UK uses a progressive income tax system. That means you only pay a higher rate on the portion of your income
above each threshold — not on your entire salary.
Use the calculator above to estimate your take-home pay, then switch to True Wage to include commute time,
costs and unpaid overtime.
Income Tax bands (England, Wales & Northern Ireland)
Personal Allowance: most people can earn up to £12,570 before paying income tax.
Basic rate: income above the allowance is typically taxed at 20% up to the basic-rate limit.
Higher rate: the slice above the higher-rate threshold is typically taxed at 40%.
Additional rate: income above the additional-rate threshold is taxed at 45%.
Scotland is differentScottish taxpayers use different income tax bands. In PayPrecise, choose Scotland in the Region selector for a better estimate.
Example: why you don’t pay 40% on your whole salary
If your salary crosses into a higher band, only the income above that threshold is taxed at the higher rate.
Your earlier income is still taxed at the lower rates.
What happens over £100,000?
Over £100,000, the Personal Allowance is reduced (tapered). This can create a much higher effective marginal rate across that range.
If you’re near this level, use the calculator above and compare scenarios using the Compare tab.
Tax isn’t the whole story
Take-home pay is affected by Income Tax and National Insurance — and your real disposable pay can fall further once you include:
commuting, lunches/coffee, tools/clothing, and unpaid overtime. That’s what True Wage is designed to show.
Calculator outputs remain illustrative because tax codes, salary sacrifice, pension settings, benefits, commuting patterns and local costs vary by person.