The main UK tax allowances for 2026/27 are: Personal Allowance £12,570, Personal Savings Allowance £1,000 (basic rate) or £500 (higher rate), dividend allowance £500, Capital Gains Tax exempt amount £3,000, ISA allowance £20,000 and pension annual allowance £60,000. Most are frozen, and several rules change from 6 April 2027, including higher tax on savings interest and a lower Cash ISA limit for under-65s.
This page is a quick reference. For a fuller explanation of how to use each allowance, see our guide to UK tax-free allowances.
Income and savings allowances
| Allowance | 2026/27 | Notes |
|---|---|---|
| Personal Allowance | £12,570 | Frozen until April 2031; reduced by £1 for every £2 over £100,000 |
| Basic-rate band | £12,571 to £50,270 | England, Wales and NI; Scotland has its own bands |
| Personal Savings Allowance | £1,000 / £500 / £0 | Basic / higher / additional-rate taxpayers |
| Starting rate for savings | Up to £5,000 | Reduced by other income above £12,570 |
| Dividend allowance | £500 | Dividend rates 10.75% / 35.75% / 39.35% |
| Capital Gains Tax exempt amount | £3,000 | Gains above taxed at 18% or 24% |
Check your own tax with our take-home pay calculator, and see Income Tax rates for 2026/27 for the full bands, including Scotland.
ISA and pension allowances
| Allowance | 2026/27 | Notes |
|---|---|---|
| ISA allowance | £20,000 | Across all your ISAs |
| Lifetime ISA | £4,000 | Counts within the £20,000; 25% bonus up to £1,000 |
| Junior ISA | £9,000 | Per child, separate from your own limit |
| Pension annual allowance | £60,000 | Or 100% of earnings if lower; tapers from £260,000 adjusted income |
| Lump Sum Allowance | £268,275 | Maximum tax-free cash from pensions |
Track what you have used this tax year with our ISA allowance tracker.
Side income and property
| Allowance | 2026/27 | Notes |
|---|---|---|
| Trading allowance | £1,000 | Gross self-employed or casual income |
| Property allowance | £1,000 | Gross rental income |
| Rent a Room | £7,500 | Letting a furnished room in your own home |
| VAT registration threshold | £90,000 | Taxable turnover over 12 months |
Family and household allowances
| Allowance | 2026/27 | Notes |
|---|---|---|
| Marriage Allowance | £1,260 transfer | Worth up to £252 a year; backdate to 6 April 2022 |
| Blind Person's Allowance | £3,250 | Added to your Personal Allowance |
| Child Benefit charge threshold | £60,000 | All benefit clawed back at £80,000 |
| Tax-Free Childcare | Up to £2,000 per child | £4,000 for a disabled child |
| Inheritance Tax nil-rate band | £325,000 | Plus £175,000 residence nil-rate band |
| Annual gift exemption | £3,000 | Plus small gifts of £250 per person |
What changed in April 2026
If your tax looks different from last year, these are the likely reasons.
- Dividend tax rates rose by 2 percentage points for basic and higher-rate taxpayers, to 10.75% and 35.75%. The additional rate stayed at 39.35%
- Tax relief for employees working from home was abolished, though you can still claim for the previous four tax years if eligible. Employers can still pay up to £6 a week tax-free
- Making Tax Digital for Income Tax started for self-employed people and landlords with qualifying income over £50,000
What changes from April 2027
Plan for these now, as some affect how you use allowances this tax year.
- Tax on savings interest rises by 2 points, to 22% basic rate, 42% higher rate and 47% additional rate. The Personal Savings Allowance amounts stay the same. Property income rates rise to the same levels
- The Cash ISA limit for under-65s falls to £12,000 a year within the £20,000 overall ISA allowance. Over-65s keep the full £20,000 for cash. That makes 2026/27 the last tax year under-65s can put £20,000 into Cash ISAs
- Making Tax Digital for Income Tax extends to qualifying income over £30,000, then over £20,000 from April 2028
Making the most of your allowances
With the Personal Allowance and higher-rate threshold frozen, pay rises pull more income into tax each year. The simplest counter-moves are using your ISA allowance for savings and investments, paying into a pension (especially through salary sacrifice), and claiming Marriage Allowance if one partner earns under £12,570. Savers whose interest is close to their Personal Savings Allowance should look at our Personal Savings Allowance guide before the 2027 rate rise. If filling an ISA feels out of reach, small regular amounts add up; SYM breaks a target into a daily figure you can tick off.
Frequently asked questions
What is the tax-free allowance for 2026/27?
How much can I earn in savings interest tax-free in 2026/27?
Is the ISA allowance changing in 2027?
What is the dividend allowance for 2026/27?
Are tax allowances frozen?
- tax allowances
- 2026/27 tax year
- Personal Allowance
- ISA allowance
- tax changes 2027