3 publishers · first seen Wed, 28 Oct 2026 15:01 UTC · updated Thu, 29 Oct 2026 13:00 UTC
UK income tax thresholds will remain frozen until the end of the 2030-31 tax year, according to the Office for Budget Responsibility (OBR), after John Healey's first Budget as chancellor. The freeze, in place since 2022-23, means more taxpayers will move into higher tax bands as earnings rise, a process known as fiscal drag. The OBR forecasts that 24 per cent of taxpayers will pay the higher or additional rate by 2030-31, up from 15 per cent in 2021-22. The personal allowance remains at £12,570, and the higher-rate threshold at £50,270 in England, Wales and Northern Ireland.
The freeze is expected to raise £58bn by 2030-31, with the OBR noting it acts as a stealth tax by increasing revenue without changing headline rates. After 2031, thresholds are scheduled to rise with inflation again. A new Pension Tax Allowance will protect low-income pensioners, ensuring those with income up to the full state pension value pay no income tax. National Insurance thresholds follow the same freeze, though a 2024 cut has offset some tax increases for middle earners.
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