The new tax year starts on Monday, April 11.This means that all kinds of financial limits and thresholds will be reset or changed for the years 2026 and 2027. Instead of calendar years, HMRC tax rules follow financial years. This means that some allowances and thresholds go from April to April instead of April to may.
Starting on Monday, April 11, everyone who makes money will have their tax-free Personal Allowance limit reset. There will also be a new allowance for 2026–27. This means that workers who used up all of their tax-free allowance for 2026–27 will be able to make more tax-free money starting on Monday.
On April 11, the tax-free Personal Allowance will start over for the new tax year. It will still be £12,570. It hasn’t changed since 2021, when it went up by £70, which is the same amount it was last year.
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It means that workers can only make £12,570 a year without paying taxes. After that, they have to pay 20% of every pound they make over that amount in Income Tax.
The bad news is that the tax-free Personal Allowance won’t go up on April 11, unlike state pensions, Universal Credit, and other benefits.
The government says, “The standard Personal Allowance is £12,570, which is the amount of money you don’t have to pay taxes on.”
“Example: You earned £35,000 that you had to pay taxes on, and you got the regular Personal Allowance of £12,570.” You paid 20% in basic rate tax on £22,430, which is £35,000 minus £12,570.
He said, “Let’s start with fiscal drag, which is the biggest tax hike that will cost everyone.” It means that your National Insurance and Income Tax rates won’t go up. I didn’t include NI because it makes things more complicated. This is for workers, and Scotland has different rates, but I’m really going to talk about the main idea.
