Every change confirmed for the 2027/28 tax year (starting 6 April 2027), based only on official GOV.UK and HMRC announcements — no speculation. Last reviewed 8 August 2026.
At Budget 2025 (26 November 2025), the Chancellor announced a 2-percentage-point rise in tax on income from assets, phased in over two years. Dividends went up first in April 2026; savings and property income follow in April 2027. Tax rates on wages and self-employment profits are not changing — but the freeze on thresholds continues, which quietly raises the tax on pay rises.
| Band | 2026/27 rate | From April 2027 |
|---|---|---|
| Basic rate | 20% | 22% |
| Higher rate | 40% | 42% |
| Additional rate | 45% | 47% |
The personal savings allowance (£1,000 basic rate / £500 higher rate) and the £5,000 starting rate for savings were not abolished in the announcement, so most people with modest savings interest will still pay nothing. The higher rates bite once interest exceeds your allowances — one more reason ISAs get more valuable from 2027.
For the first time, rental income gets its own income tax rates — 2 percentage points above the rates on wages:
| Band | Rate on wages | New property rate (April 2027) |
|---|---|---|
| Property basic rate | 20% | 22% |
| Property higher rate | 40% | 42% |
| Property additional rate | 45% | 47% |
Mortgage interest (finance cost) relief will be given at the property basic rate of 22% rather than 20%, partially softening the blow for leveraged landlords. Reporting stays the same — only the rates change. A basic-rate landlord with £10,000 of taxable rental profit pays about £200/year more.
| Rate | 2025/26 | From April 2026 |
|---|---|---|
| Ordinary (basic) rate | 8.75% | 10.75% |
| Upper (higher) rate | 33.75% | 35.75% |
| Additional rate | 39.35% | 39.35% (unchanged) |
If you run a limited company or hold shares outside an ISA, this is the rate you're already paying in the 2026/27 tax year — worth factoring into any salary-vs-dividend planning before 2027.
| Threshold | 2026/27 & 2027/28 |
|---|---|
| Personal allowance | £12,570 (frozen) |
| Basic rate band | £37,700 above allowance (higher rate starts at £50,270) |
| Additional rate threshold | £125,140 |
| Personal allowance taper | Starts at £100,000 income |
Government policy papers confirm the personal allowance and basic rate limit are fixed at these levels through at least 5 April 2028. With wage growth, every pay rise drags more income into the 40% and 45% bands even though headline rates haven't moved — HMRC's quietest tax rise.
Full 2027/28 payroll thresholds (National Insurance limits, Scottish bands) haven't been published yet — HMRC typically releases the employer rates tables in January/February 2027. No changes to income tax rates on wages, employee NI rates, or the pension annual allowance have been announced for April 2027. We'll update this page when the official 2027/28 tables land; anything not listed above is speculation.
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UK Salary Calculator → Rental Income Tax Calculator → UK Take-Home by Salary →Savings income tax rises 2 percentage points (22%/42%/47%) and property income gets separate rates of 22%/42%/47%, with finance cost relief at 22%. Both were announced at Budget 2025.
No rate rise on employment income has been announced. But frozen thresholds mean fiscal drag continues to raise effective tax bills as pay rises.
It rose 2pp a year earlier, from April 2026: ordinary rate 10.75%, upper rate 35.75%. The additional rate stays 39.35%.
Rental profits move to 22%/42%/47% rates — roughly £200/year more per £10,000 of profit for a basic-rate landlord, partly offset by mortgage relief at 22% instead of 20%.
Yes — £12,570 personal allowance and £37,700 basic rate limit are confirmed frozen through at least 5 April 2028.
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This page summarises official government announcements for general information only and is not tax advice. Figures are as announced at Budget 2025 and may change if legislation is amended. Always check GOV.UK or speak to a qualified adviser before acting.