UK Tax Rates 2025/26 | Complete Guide to All Tax Rates

James Mitchell · Senior Tax Advisor (CTA, ATT) · Reviewed Apr 2026

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1. Income Tax Rates (England, Wales & Northern Ireland)

Income tax is the largest tax most people pay. The rates below apply to England, Wales and Northern Ireland for the 2025/26 tax year. Scotland has its own rates (see below).

Band	Taxable Income	Rate
Personal Allowance	Up to £12,570	0%
Basic Rate	£12,571 – £50,270	20%
Higher Rate	£50,271 – £125,140	40%
Additional Rate	Over £125,140	45%

Note: The personal allowance reduces by £1 for every £2 of income over £100,000, reaching £0 at £125,140.

2. Scottish Income Tax Rates 2025/26

If you live in Scotland, you pay Scottish income tax rates set by the Scottish Parliament. These rates differ from the rest of the UK.

Band	Taxable Income	Rate
Personal Allowance	Up to £12,570	0%
Starter Rate	£12,571 – £14,876	19%
Basic Rate	£14,877 – £26,561	20%
Intermediate Rate	£26,562 – £43,662	21%
Higher Rate	£43,663 – £75,000	42%
Advanced Rate	£75,001 – £125,140	45%
Top Rate	Over £125,140	48%

Scottish taxpayers: Your tax code will start with an "S" (e.g. S1257L). NI rates, VAT and all other taxes are the same across the UK.

3. National Insurance Rates 2025/26

National Insurance contributions fund the state pension and certain benefits. Rates differ for employees, employers and the self-employed.

Employee (Class 1)

Earnings	Rate
Up to £12,570 (Primary Threshold)	0%
£12,570 – £50,270	8%
Over £50,270	2%

Employer (Class 1)

Earnings	Rate
Up to £5,000 (Secondary Threshold)	0%
Over £5,000	15%

Self-Employed (Class 4)

Profits	Rate
Up to £12,570 (Lower Profits Limit)	0%
£12,570 – £50,270	6%
Over £50,270	2%

Class 2 NI: Voluntary for self-employed from 2024/25. If you choose to pay, the rate is £3.45 per week.

4. Corporation Tax Rates 2025/26

Corporation tax applies to company profits. Since April 2023, a two-tier system applies based on profit levels.

Profit Level	Rate
Small Profits (£0 – £50,000)	19%
Marginal Relief (£50,001 – £250,000)	19% – 25%
Main Rate (over £250,000)	25%

Marginal relief formula: For profits between £50,000 and £250,000, marginal relief reduces the effective rate gradually from 25% down towards 19%. The marginal relief fraction is 3/200.

5. Capital Gains Tax Rates 2025/26

Capital gains tax applies when you sell assets for a profit. Rates changed from 30 October 2024 following the Autumn Budget.

Asset Type	Basic Rate Taxpayer	Higher/Additional Rate
Most assets (shares, funds, etc.)	18%	24%
Residential property (not main home)	18%	24%
Business Asset Disposal Relief	14% (rising to 18% from April 2026)
Investors' Relief	14% (rising to 18% from April 2026)

Annual Exempt Amount: £3,000 per person for 2025/26. Gains below this are tax-free.

6. Inheritance Tax Rates 2025/26

Inheritance tax (IHT) is charged on estates above certain thresholds when someone dies.

Threshold / Rate	Amount
Nil-Rate Band (NRB)	£325,000
Residence Nil-Rate Band (RNRB)	£175,000
Combined threshold (individual)	£500,000
Combined threshold (married couple, transferable)	£1,000,000
IHT Rate (above thresholds)	40%
Reduced rate (10%+ left to charity)	36%

RNRB taper: The residence nil-rate band reduces for estates worth over £2 million, by £1 for every £2 above £2 million.

7. Stamp Duty Land Tax (SDLT) Rates 2025/26

Stamp duty is paid when you buy property in England or Northern Ireland. Rates reverted from 1 April 2025 after the temporary thresholds ended.

Standard Residential Rates (from 1 April 2025)

Property Price Portion	Rate
Up to £125,000	0%
£125,001 – £250,000	2%
£250,001 – £925,000	5%
£925,001 – £1,500,000	10%
Over £1,500,000	12%

Additional Property Surcharge

Property Price Portion	Rate
Up to £125,000	5%
£125,001 – £250,000	7%
£250,001 – £925,000	10%
£925,001 – £1,500,000	15%
Over £1,500,000	17%

First-time buyers: No SDLT on the first £300,000 of a property up to £500,000 (from 1 April 2025). 5% applies on the portion from £300,001 to £500,000.

8. VAT Rates 2025/26

Value Added Tax is charged on most goods and services sold in the UK.

Type	Rate	Examples
Standard Rate	20%	Most goods and services
Reduced Rate	5%	Home energy, child car seats, sanitary products
Zero Rate	0%	Most food, children's clothes, books, newspapers
Exempt	N/A	Insurance, education, health services, financial services

VAT registration threshold: £90,000 turnover (from 1 April 2024). Businesses below this can register voluntarily.

9. Dividend Tax Rates 2025/26

Dividends are taxed at special rates that are lower than income tax rates. A £1,000 dividend allowance applies before tax is due.

Tax Band	Dividend Rate
Personal Allowance / Dividend Allowance	0%
Basic Rate (up to £50,270)	8.75%
Higher Rate (£50,271 – £125,140)	33.75%
Additional Rate (over £125,140)	39.35%

Dividend Allowance: The first £1,000 of dividends is tax-free in 2025/26 (increased from £500 in 2024/25). This allowance uses up your basic or higher rate band.

10. Student Loan Repayment Rates 2025/26

Student loan repayments are deducted from your salary once you earn above your plan's threshold. These are not technically a tax, but they reduce your take-home pay.

Plan	Annual Threshold	Rate
Plan 1 (pre-September 2012)	£24,990	9%
Plan 2 (post-September 2012)	£27,295	9%
Plan 4 (Scotland)	£31,395	9%
Plan 5 (from September 2023)	£25,000	9%
Postgraduate Loan	£21,000	6%

Note: Repayments are 9% (or 6%) of income above the threshold, not on total earnings. Plan 2 loans are written off after 30 years; Plan 5 after 40 years.

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Frequently Asked Questions

What are the UK income tax rates for 2025/26?

The UK income tax rates for 2025/26 are: 0% on the personal allowance (up to £12,570), 20% basic rate (£12,571 to £50,270), 40% higher rate (£50,271 to £125,140), and 45% additional rate (over £125,140). Scotland has different rates ranging from 19% to 48%.

What is the corporation tax rate in the UK?

The UK corporation tax rate for 2025/26 is 25% for companies with profits over £250,000, and 19% for small companies with profits under £50,000. Companies with profits between £50,000 and £250,000 benefit from marginal relief, paying an effective rate between 19% and 25%.

What are the capital gains tax rates for 2025/26?

From 30 October 2024, CGT rates increased: basic rate taxpayers pay 18% (previously 10%) on gains, and higher/additional rate taxpayers pay 24% (previously 20%). Residential property rates remain at 18% and 24%. The annual exempt amount is £3,000.

How much inheritance tax do you pay in the UK?

Inheritance tax is charged at 40% on the estate value above the nil-rate band of £325,000. An additional residence nil-rate band of £175,000 may apply if you pass your home to direct descendants. The effective threshold for a married couple can be up to £1,000,000 with both allowances transferred.

Are Scottish tax rates different from the rest of the UK?

Yes. Scotland has its own income tax rates for 2025/26 with six bands: 19% starter rate, 20% basic rate, 21% intermediate rate, 42% higher rate, 45% advanced rate, and 48% top rate. Scottish taxpayers also have a different personal allowance threshold structure. National Insurance, VAT and all other taxes are the same across the UK.

Official Sources

Expert review: Mustafa Bilgic. Data verified against official UK government sources. Last checked April 2026.