Question 1

What are the UK tax brackets for 2025/26?

Accepted Answer

For 2025/26, UK income tax rates are: Personal Allowance of £12,570 (0%), Basic rate 20% on £12,571-£50,270, Higher rate 40% on £50,271-£125,140, and Additional rate 45% on income above £125,140. The Personal Allowance reduces for income over £100,000.

Question 2

How is National Insurance calculated in the UK?

Accepted Answer

Employee National Insurance (Class 1) for 2025/26 is charged at 8% on earnings between £12,570 and £50,270 per year, and 2% on earnings above £50,270. Earnings below the Primary Threshold (£12,570/year) are not subject to NI.

Question 3

What is the Personal Allowance taper?

Accepted Answer

If your income exceeds £100,000, your £12,570 Personal Allowance is reduced by £1 for every £2 of income above £100,000. This means the allowance reaches zero at £125,140, creating an effective 60% marginal tax rate in the £100,000-£125,140 range.

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