What the tax freeze will cost you by 2031
Income tax and National Insurance thresholds are frozen until April 2031, so every pay rise is taxed harder. Enter your salary to see the impact. This page updates as soon as confirmed Budget measures are published.
Last updated 24 October 2026 · England, Wales and Northern Ireland rules
Personal impact calculator
Your freeze bill
Compare the tax and National Insurance you could pay if thresholds stay frozen with a scenario where they rise with inflation.
estimated extra income tax and National Insurance paid between 2027/28 and 2030/31 because thresholds stay frozen
| Tax year | Salary | Bill, frozen | Bill, indexed | Extra from freeze |
|---|
Employee income tax plus NI on salary only. Ignores pension contributions, student loans, benefits and Scottish rates. Estimate, not tax advice.
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Already confirmed before the Budget
- Income tax and NI thresholds frozen until April 2031
Personal allowance stays at £12,570 and the higher-rate threshold at £50,270 (England, Wales and Northern Ireland). NI thresholds are frozen to the same date.
Primary source - Cash ISA limit falls to £12,000 for under-65s
The total ISA allowance stays at £20,000. Savers under 65 can put at most £12,000 of it in cash. 2026/27 is the last year for a full £20,000 in cash.
Primary source - 22% charge on interest from cash held in non-cash ISAs
Aimed at stopping savers from parking cash in a Stocks and Shares ISA to dodge the new cap.
Primary source - Savings and property income tax rates rise by 2 points
Basic, higher and additional rates become 22%, 42% and 47%.
Primary source - Dividend tax rates rose by 2 points
Ordinary and upper dividend rates went up; higher-rate taxpayers pay 35.75% above the allowance.
Primary source - Unused pensions brought into inheritance tax
Most unused pension funds and death benefits count towards the estate. Industry groups are lobbying for a rethink, so watch for changes.
Primary source
Reported or promised, not confirmed
Treat these as rumour until they appear in the Chancellor’s statement or published Budget documents.
- Personal allowance
The Prime Minister has said there is no commitment to change it but it will be looked at. Nothing is confirmed.
- Tax on State Pension-only income
The pensions minister has promised details at the Budget on how people living only on the State Pension avoid tax.
- Capital gains tax
Reports say the Chancellor has ruled out matching CGT rates to income tax rates.
- Main tax rates
Ministers say they do not intend to raise the main rates of income tax, National Insurance or VAT.
Tax-free saving limits on both sides of the Atlantic
United States, 2026
- 401(k) / 403(b) / 457(b)
- $24,500 (deadline 31 December)
- Traditional or Roth IRA
- $7,500 (deadline 15 April 2027)
- HSA
- $4,400 self-only, $8,750 family
United Kingdom, 2026/27
- ISA allowance, all types
- £20,000 (deadline 5 April 2027)
- Cash ISA, under 65, from 6 April 2027
- £12,000
- Lifetime ISA / Junior ISA
- £4,000 / £9,000
Questions people ask
When is the UK Budget 2026?
Chancellor John Healey delivers the Autumn Budget on Wednesday 28 October 2026, shortly after Prime Minister’s Questions at around 12:30pm. The OBR publishes its economic forecast the same day.
How long are income tax thresholds frozen?
Until April 2031. The personal allowance stays at £12,570 and the higher-rate threshold at £50,270, and National Insurance thresholds are frozen to the same date.
What is fiscal drag?
When thresholds stay still while pay rises, more of your income falls into taxed bands, so your tax bill grows without any change in tax rates.
Does the calculator work in Scotland?
No. Scotland sets its own income tax bands. The calculator uses the England, Wales and Northern Ireland rules for 2026/27.
For wider context, compare this with our Cash ISA limit 2027 explained, interest-rates guide, 2026 money moves playbook, emergency fund guide, and side-hustle take-home calculator.
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How we calculated this
We use 2026/27 rules: personal allowance £12,570 (reduced by £1 for every £2 of income over £100,000), 20% on the next £37,700, 40% up to £125,140, 45% above; employee NI of 8% between £12,570 and £50,270 and 2% above. The indexed column scales every threshold by your inflation figure each April from 2027. Salary grows by your pay-rise figure. Nothing you type leaves your browser.
General information, not financial or tax advice. Check figures at GOV.UK before acting.