The personal allowance explained

The Personal Allowance is the amount of income you can have each tax year before income tax starts. For 2026/27 it is £12,570, which works out at £1,048 a month or £242 a week through payroll. It is frozen at that level until 5 April 2031. Above £100,000 of adjusted net income it is reduced by £1 for every £2, and it disappears completely at £125,140.

How the allowance gets into your pay

As an employee you never claim the allowance directly. HMRC puts it into your tax code and your employer’s payroll applies it. The standard code is 1257L: the number is the allowance with the last digit dropped, so 1257 stands for £12,570.

Payroll spreads the allowance evenly across the year. On a monthly payroll, roughly £1,048 of each month’s pay is tax-free and the rest is taxed. PAYE is cumulative, so if you earn less than £1,048 one month, the unused amount rolls forward to later months.

Your code can show a different number from 1257 when HMRC adjusts the allowance. Taxable benefits such as private medical insurance, unpaid tax from an earlier year or a reduction for high income all lower the number. Allowances you are entitled to, such as Marriage Allowance or tax relief on job expenses, raise it. Tax codes explained goes through the letters and numbers.

The taper above £100,000

Once your adjusted net income goes over £100,000, you lose £1 of allowance for every £2 above that line. At £125,140 the allowance is zero.

Adjusted net income	Personal Allowance
£100,000 or less	£12,570
£105,000	£10,070
£110,000	£7,570
£120,000	£2,570
£125,140 or more	£0

The result is a steep marginal rate in that slice. Each extra £1 is taxed at 40%, and it also removes 50p of allowance, which pulls another 50p into the 40% band. That adds up to 60p of income tax on each extra pound, before National Insurance at 2%. In the public sector this mainly hits senior doctors, very senior managers and some headteachers. A consultant on the 2003 contract starts at £113,565, and NHS band 9 starts at £112,782. The £100,000 tax trap looks at this in detail.

Your employer’s payroll does not apply the taper automatically from your salary. HMRC usually adjusts your code once it knows your income is over £100,000, and anything still owed is collected through Self Assessment or a later code.

What “adjusted net income” means

The taper runs on adjusted net income, which can differ from your salary. Broadly, it is your total taxable income (pay, benefits in kind, rental profit, savings interest and dividends) minus certain reliefs. The reductions that most often matter are:

• pension contributions made under a net pay arrangement, which is how NHS, teachers’, local government and Civil Service schemes usually work, so they are already out of your taxable pay
• personal pension contributions made under relief at source, grossed up
• Gift Aid donations, grossed up.

The same measure decides the High Income Child Benefit Charge (from £60,000) and whether you can get Tax-Free Childcare or the working parent funded childcare hours in England (neither parent can be over £100,000). Near one of these lines, gov.uk sets out what counts, and HMRC or a qualified adviser can help with your own position. See pension tax relief for how scheme contributions are handled.

Allowances that add to it

Marriage Allowance

If you are married or in a civil partnership and one of you earns less than the Personal Allowance, that person can transfer £1,260 of unused allowance to the other. This cuts the receiver’s tax by up to £252 a year. The receiver must be a basic-rate taxpayer, meaning income between £12,571 and £50,270, or in Scotland a starter, basic or intermediate rate taxpayer with income between £12,571 and £43,662.

In tax codes, the person receiving the transfer has an M at the end of their code and the person giving it has an N. The Marriage Allowance guide covers claiming and backdating.

Blind Person’s Allowance

If you are registered blind (or severely sight impaired), you get an extra £3,250 on top of the Personal Allowance for 2026/27. It can be transferred to a spouse or civil partner if you cannot use it all. See Blind Person’s Allowance.

Married Couple’s Allowance

This is only for married couples and civil partners where one partner was born long enough ago to meet the age rule on gov.uk, so few people still in work can claim it. For 2026/27 the allowance has a maximum of £11,700 and a minimum of £4,530. It reduces your tax bill and leaves your tax-free income as it was, and gov.uk explains how much of it you get.

When the allowance is used up or missing

A code of 0T means you have no tax-free allowance from that job, either because it has been used up elsewhere or because your employer has no details for you yet. A BR code taxes every pound at 20%, which is normal for a second job because your main job already has the allowance. A K code means your untaxed income or benefits are bigger than your allowance, so an amount is added to your taxable pay.

With two part-time jobs and neither paying more than £12,570, you can ask HMRC to split your allowance between them. Otherwise you may pay tax on the second job while part of your allowance sits unused at the first. Call HMRC or use your personal tax account to ask for the change; tax when you have two jobs explains the options.

Scotland and Wales

The UK Parliament sets the Personal Allowance, so it is the same £12,570 for Scottish and Welsh taxpayers. The rates charged above it are what differ. Scotland’s first band above the allowance is a 19% starter rate, and Welsh taxpayers pay the same totals as England this year.