How much income tax do I pay in the UK?
Short answer
Most people pay no tax on the first £12,570 of income — the personal allowance — then 20 per cent, 40 per cent and 45 per cent in rising bands. Scotland sets its own rates and bands with more steps. National Insurance is charged separately on earnings, on top.
Verified · 4 cited sources
The UK uses a progressive marginal system. The personal allowance covers the first slice of income, then each band's rate applies only to the income falling within it. Moving into a higher band never reduces your take-home pay, because only the portion above the threshold is taxed at the higher rate.
There is one genuine cliff edge: the personal allowance is reduced by £1 for every £2 of income above £100,000, so it disappears entirely by £125,140. That produces an effective marginal rate of 60 per cent on income in that band — higher than the headline additional rate — which catches a great many people by surprise.
Scotland sets its own rates and bands on earned income under powers devolved by the Scotland Act 2016, with more bands than the rest of the UK. Whether you are a Scottish taxpayer depends on where your main home is, not where you work, and HMRC applies an S prefix to your tax code. Savings and dividend income remain on UK-wide rates everywhere.
National Insurance is a separate charge on earnings above a threshold, paid by both employee and employer, and it builds entitlement to the state pension and some contributory benefits. It is not charged on pension income.
The personal allowance and higher-rate threshold have been frozen rather than uprated for several years. As wages rise, more income falls above each threshold — an effect known as fiscal drag, which raises substantial revenue without any headline rate changing.
- Personal allowance: £12,570 for most people
- Allowance tapers away between £100,000 and £125,140, creating a 60 per cent effective band
- Scotland sets its own rates and bands on earned income
- National Insurance is charged separately on earnings, not on pensions
- Frozen thresholds raise tax through fiscal drag without any rate change
People also ask
Sources & provenance
Facts verified
- 1.Income Tax rates and Personal Allowances OfficialUK GovernmentUsed for: Bands, rates and the personal allowance
- 2.Income over £100,000 OfficialUK GovernmentUsed for: Personal allowance taper between £100,000 and £125,140
- 3.Scottish Income Tax OfficialUK GovernmentUsed for: Separate Scottish rates and bands and how taxpayer status is determined
- 4.National Insurance OfficialUK GovernmentUsed for: Separate charge on earnings and what it builds entitlement to
Rates, thresholds and the taper come from the GOV.UK pages cited. Rates and thresholds change at fiscal events and take effect from 6 April; the personal allowance figure reflects the frozen threshold at the review date. The description of the taper as a '60 per cent effective band' is a standard characterisation among tax commentators rather than HMRC wording. Check GOV.UK for current figures before relying on them.
Facts on this page are taken from the sources listed above — UK government departments, devolved administrations, regulators, statutory bodies and official statistical releases. Comparisons, judgements and "which option suits whom" conclusions are AI-assisted analysis written over those sources; they are marked in the text and listed as an AI-analysis entry in the sources, not attributed to any authority. Rates, thresholds, fees and processing times change, usually at the start of a tax year in April; figures are current as at the review date shown and should be confirmed with the responsible body before you rely on them. Much of what follows differs between England, Scotland, Wales and Northern Ireland — where it does, this site says so.