What Is the UK Tax-Free Personal Allowance for 2026/27?

The UK tax-free Personal Allowance for the 2026/27 tax year (6 April 2026 to 5 April 2027) is £12,570. This means you can earn up to £12,570 in the tax year before you start paying Income Tax. The allowance has been frozen at this level since 2021/22 and is set to remain frozen until at least 2031. If your income is over £100,000, your allowance is gradually reduced and disappears completely once you earn £125,140 or more.

At CalZone, we know tax jargon can be confusing, so this guide breaks down exactly what the Personal Allowance means for your take-home pay in 2026/27, who qualifies, and how to make the most of it.

What Is the Personal Allowance?

The Personal Allowance is the amount of income every UK taxpayer can earn each tax year before Income Tax applies. It's the "tax-free slice" that sits at the bottom of your earnings. Whether your income comes from a salary, self-employment profits, pension payments, or rental income, the first portion of it — up to the Personal Allowance threshold — is yours to keep in full.

Only once your total taxable income goes above £12,570 do you start paying Income Tax, and only on the amount above that threshold, not on your whole income.

How Much Is the Personal Allowance for 2026/27?

For the 2026/27 tax year, the standard Personal Allowance is:

• £12,570 for most taxpayers with income below £100,000

This is unchanged from the previous several tax years. The UK government froze the Personal Allowance at £12,570 from 2021/22 onwards, and this freeze — originally due to end sooner — has now been extended, with most current guidance pointing to the threshold staying fixed until 2031. That means your tax-free amount is very unlikely to rise for several more years, even while wages and living costs continue to increase.

A Simple Example

Say you earn £35,000 in the 2026/27 tax year:

• The first £12,570 is completely tax-free.
• The remaining £22,430 (£35,000 minus £12,570) falls into the basic rate band and is taxed at 20%.
• Your Income Tax bill for the year would be roughly £4,486.

This is the core principle behind the Personal Allowance: it isn't a discount on your whole salary, it's a slice at the bottom that's protected from tax entirely.

Your Tax Code and the Personal Allowance

If you're employed or receive a pension, you'll usually see your Personal Allowance reflected automatically in your tax code. For most people with the standard allowance, the 2026/27 tax code is 1257L. The numbers (1257) represent your £12,570 allowance, and the letter L shows you're entitled to the standard, unrestricted allowance. If your tax code looks different, it may mean HMRC has adjusted your allowance — for example, because of a company benefit, previous underpayment, or additional income.

Income Tax Bands for 2026/27

Once your income exceeds the Personal Allowance, the rate you pay depends on which band your taxable income falls into (these apply in England, Wales, and Northern Ireland; Scotland has its own bands, though the Personal Allowance itself is set UK-wide):

* The basic rate limit itself is frozen at £37,700, which combined with the £12,570 allowance gives the higher-rate threshold of £50,270.

The £100,000 Taper: Where High Earners Lose Their Allowance

Here's the part many higher earners miss. Once your adjusted net income goes above £100,000, your Personal Allowance starts shrinking. For every £2 you earn above £100,000, you lose £1 of allowance. By the time your income reaches £125,140, your entire Personal Allowance has gone.

This creates what's often called the "60% tax trap." Between £100,000 and £125,140, you're paying 40% Income Tax on that slice of income and simultaneously losing your tax-free allowance, which pushes your effective marginal rate up to around 60%.

Example: If you earn £120,000, your income is £20,000 over the £100,000 threshold. Your Personal Allowance is reduced by £10,000 (£1 for every £2 over the limit), leaving you with just £2,570 of tax-free income instead of £12,570.

How to Protect Your Personal Allowance

If your income sits near or above £100,000, there are legitimate ways to bring your adjusted net income back down and restore some or all of your allowance:

• Pension contributions – paying into a workplace or personal pension reduces your adjusted net income.
• Charitable donations via Gift Aid – these can also lower your adjusted net income.
• Salary sacrifice schemes – for pensions, electric vehicles, or cycle-to-work schemes.

Because the numbers involved can be significant, it's worth speaking to a qualified accountant or tax adviser before making decisions based on the taper, since everyone's circumstances are different.

Who Doesn't Get the Full Personal Allowance?

A few situations reduce or remove the standard allowance:

• High earners — as explained above, anyone with adjusted net income over £125,140 gets no Personal Allowance at all.
• Non-domiciled individuals who claim the remittance basis of taxation.
• Certain non-resident taxpayers, depending on double taxation agreements.

Most employed and self-employed people in the UK, however, are entitled to the full £12,570.

Marriage Allowance

If you're married or in a civil partnership and one partner earns below the Personal Allowance while the other is a basic-rate taxpayer, you may be able to use the Marriage Allowance. This lets the lower-earning partner transfer £1,260 of their unused Personal Allowance to their spouse or civil partner, which can reduce the receiving partner's tax bill by up to £252 a year. The lower-earning partner needs to make the claim, and it can be backdated in some cases.

Blind Person's Allowance

If you're registered blind or severely sight impaired, you may qualify for the Blind Person's Allowance, which is added on top of your standard Personal Allowance. For 2026/27, this additional allowance is £3,250, meaning eligible individuals can earn £15,820 before paying Income Tax. This allowance can also be transferred between spouses or civil partners if it isn't fully used.

Other Tax-Free Allowances Worth Knowing in 2026/27

The Personal Allowance is just one of several UK tax-free thresholds. Depending on your situation, you might also benefit from:

• Personal Savings Allowance – up to £1,000 tax-free interest for basic-rate taxpayers, £500 for higher-rate taxpayers.
• Dividend Allowance – the first £500 of dividend income is tax-free.
• Trading Allowance – the first £1,000 of self-employed or side-hustle income is tax-free.
• Property Allowance – the first £1,000 of property income is tax-free.
• ISA Allowance – you can save or invest up to £20,000 per year across ISAs completely free of Income Tax and Capital Gains Tax.

Why Is the Personal Allowance Frozen?

Since 2021/22, successive governments have kept the Personal Allowance and most other Income Tax thresholds frozen rather than increasing them in line with inflation. On the surface this looks like stability, but as wages rise to keep pace with the cost of living, more of your income creeps above the frozen threshold and into taxable territory — a process economists call fiscal drag. In effect, it's a gradual, hidden tax increase, since you end up paying more tax over time even though the headline allowance hasn't been cut.

Disclaimer

This article is for general information only and does not constitute financial or tax advice. Tax rules can change, and individual circumstances vary — always check GOV.UK or speak with a qualified accountant for advice specific to your situation.