UK Tax Guide 2026/27: Rates, Allowances and Deadlines
The numbers every UK sole trader, landlord and company director needs this year: Income Tax, dividends, National Insurance, Corporation Tax, VAT and HMRC deadlines.
- 6 April 2026 – 5 April 2027
- HMRC figures
- Plain English
The personal allowance falls by £1 for every £2 of income over £100,000. Scotland has its own bands for earned income.
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Personal tax 2026/27
Dividend rates rose by 2 percentage points from 6 April 2026.
| Income Tax | 2026/27 |
|---|---|
| Personal allowance | £12,570 |
| Basic rate 20% | £12,571 – £50,270 |
| Higher rate 40% | £50,271 – £125,140 |
| Additional rate 45% | Over £125,140 |
| Dividends | 2026/27 |
|---|---|
| Dividend allowance | £500 |
| Basic rate | 10.75% |
| Higher rate | 35.75% |
| Additional rate | 39.35% |
| National Insurance | 2026/27 |
|---|---|
| Employee (Class 1) | 8% on £12,570 – £50,270, 2% above |
| Employer (Class 1) | 15% above £5,000 a year |
| Employment Allowance | £10,500 off employer NI |
| Self-employed (Class 4) | 6% on £12,570 – £50,270, 2% above |
| Capital gains & savings | 2026/27 |
|---|---|
| CGT annual exempt amount | £3,000 |
| CGT rates | 18% basic, 24% higher |
| ISA allowance | £20,000 |
| Pension annual allowance | £60,000 |
Company tax at a glance
Corporation Tax
19% small profits rate up to £50,000; 25% main rate over £250,000; marginal relief between.
Paying Corporation Tax
Due 9 months and 1 day after your accounting period ends.
CT600 return
Filed with HMRC within 12 months of the period end.
Annual accounts
Filed at Companies House within 9 months of year end (private company).
Confirmation statement
Every 12 months, within 14 days of the review date. Fee £50.
Director ID verification
All directors and people with significant control must verify their identity with Companies House.
Annual Investment Allowance
Deduct the full cost of qualifying equipment and vans in the year you buy them.
Salary + dividends
Directors often take a salary up to the personal allowance and the rest as dividends.
VAT
Standard rate 20%. Register within 30 days of crossing £90,000.
Key HMRC and Companies House dates
For the 2026/27 tax year (6 April 2026 to 5 April 2027).
Register for Self Assessment
If you became self-employed or a landlord in 2025/26 and have not registered yet.
Paper Self Assessment return
Deadline for paper returns for 2025/26.
Online Self Assessment return
2025/26 online return, balancing payment and first payment on account for 2026/27.
Tax year ends
Last day to use 2026/27 ISA, pension and CGT allowances.
P60s to employees
Give every employee their P60 for 2026/27.
P11D and P11D(b)
Report benefits in kind and pay Class 1A NI by 22 July.
Second payment on account
Second instalment towards your 2026/27 tax bill.
MTD for Income Tax: are you in?
Sole traders and landlords must keep digital records and send quarterly updates to HMRC once their qualifying income passes the threshold.
Qualifying income = gross self-employment and property income before expenses.
Quarter 1 update
For 6 April – 5 July.
Quarter 2 update
For 6 July – 5 October.
Quarter 3 update
For 6 October – 5 January.
Quarter 4 update
For 6 January – 5 April, then a final declaration by 31 January.
What a late Self Assessment return costs
Penalties apply even if you owe no tax. Late payment adds interest and 5% surcharges. VAT and MTD use a points-based system instead.
- VAT: one penalty point per late return; a £200 fine when you reach the threshold (4 points for quarterly filers)
- Corporation Tax: £100 if the CT600 is 1 day late, another £100 at 3 months
- Companies House: £150 to £1,500 for late accounts, doubled if late two years running
- PAYE: penalties if your RTI submissions are late, based on the number of employees
10 rules that keep UK businesses out of trouble
- Register for Self Assessment by 5 October after your first year of trading
- Keep records for at least 5 years after the 31 January deadline (6 years for companies)
- Use a separate business bank account
- Register for VAT within 30 days of passing £90,000
- Set aside money for payments on account in January and July
- Use MTD-compatible software if your income is over £50,000
- Claim the trading or property allowance (£1,000) if your costs are small
- Directors: keep salary and dividends paperwork with board minutes
- Verify your identity with Companies House as a director
- Claim Annual Investment Allowance on equipment and vans
Switching to Tax Expert takes 4 simple steps
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UK tax questions
Is the first month really free?
Yes. New clients on a monthly accounting or bookkeeping plan pay nothing for the first month. If you are not happy, you can leave without paying. If you stay, payment starts from month 2 at the fixed fee we agreed. Government and filing fees are not included.
What is the personal allowance for 2026/27?
£12,570. It is frozen until April 2031 and reduces by £1 for every £2 of income above £100,000.
How much tax do I pay on dividends in 2026/27?
The first £500 is tax-free. Above that, 10.75% in the basic rate band, 35.75% in the higher rate band and 39.35% in the additional rate band.
What is the Corporation Tax rate?
19% if profits are £50,000 or less, 25% if profits are over £250,000, with marginal relief in between.
Do I need Making Tax Digital for Income Tax?
From 6 April 2026 if your self-employment and property income is over £50,000, from April 2027 if over £30,000, and from April 2028 if over £20,000.
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