UK Personal Allowance — Calculate Your Tax-Free Amount
Calculate your Personal Allowance for the 2026-27 tax year. Understand how it reduces above £100000 income and disappears at £125140.
The UK Personal Allowance is £12570 of tax-free income for 2026-27. However it reduces by £1 for every £2 of income above £100000 creating an effective 60% tax rate between £100000-£125140. At £125140 the allowance is completely gone. This cliff creates one of the most punishing tax rates in the UK system and requires careful planning for high earners.
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Key Information
| Parameter | Details |
|---|---|
| Personal Allowance (2026-27) | £12570 |
| Reduction Threshold | £100000 income |
| Effective Rate (£100K-£125K) | 60% marginal |
| Allowance Eliminated At | £125140 |
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Use Calculator NowFrequently Asked Questions
How does the £100000 trap work?
Between £100000-£125140 you lose £1 of Personal Allowance for every £2 earned. On £2 extra income: you pay 40% tax on £2 (£0.80) plus lose £1 of allowance meaning £1 of previously tax-free income is now taxed at 40% (£0.40). Total tax on £2: £1.20 = 60% rate. This is higher than the 45% additional rate.
How to avoid the Personal Allowance trap?
Contribute to pension to bring income below £100000. A £5000 pension contribution at £105000 income saves £2000 in tax from the allowance restoration plus the normal 40% relief. Salary sacrifice into pension is especially effective. Charitable donations via Gift Aid also reduce adjusted net income.
Does everyone get £12570 Personal Allowance?
Most UK residents get the full £12570. Exceptions: income above £100000 (tapered). Non-residents may get reduced or no allowance depending on nationality. Some older people have slightly higher allowances from legacy rules. The allowance has been frozen at £12570 since 2021-22 meaning fiscal drag pulls more people into higher tax brackets each year.
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Last updated: March 2026