UK Tax & Salary Monthly Review — June 2026
Welcome to the June 2026 edition of our monthly UK tax and salary review. Each month we round up the key developments affecting your take-home pay — from HMRC announcements and wage data to upcoming deadlines and tax planning reminders.
This Month at a Glance
- The 2025/26 tax year closed on 5 April — Self Assessment registrations for new filers now open
- National Living Wage rose to £12.21/hour from 6 April 2026 for workers aged 21 and over
- HMRC confirms frozen income tax thresholds continue through to April 2028
- ONS average weekly earnings data shows UK median salary at approximately £37,500 for full-time workers
- Child Benefit High Income Charge threshold confirmed at £60,000 for 2026/27
Tax Year 2026/27 — What Changed from April
The new tax year began on 6 April 2026. The headline income tax bands remain unchanged from 2025/26 — the Personal Allowance stays at £12,570 and the higher rate threshold at £50,270. These thresholds have been frozen since 2021 and are set to remain frozen until April 2028.
| Band | Income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Basic rate | £12,571–£50,270 | 20% |
| Higher rate | £50,271–£125,140 | 40% |
| Additional rate | Over £125,140 | 45% |
Fiscal drag in practice: because thresholds are frozen while wages rise, an estimated 400,000 additional workers are expected to cross into the higher rate band during 2026/27 compared to 2021 levels — paying 40% on income they would previously have paid 20% on.
National Living Wage: Now £12.21/hour
The National Living Wage (NLW) increased from £11.44 to £12.21 per hour on 6 April 2026 for workers aged 21 and over — a 6.7% rise. This follows the Low Pay Commission's recommendation and brings the NLW broadly in line with two-thirds of median hourly pay.
| Age group | Rate per hour |
|---|---|
| 21 and over (National Living Wage) | £12.21 |
| 18–20 | £10.00 |
| Under 18 | £7.55 |
| Apprentice | £7.55 |
At £12.21/hour for a standard 37.5-hour week, a full-time NLW worker earns approximately £23,810 per year — taking home around £19,850 after income tax and National Insurance.
Self Assessment: Register by 5 October 2026
If you need to file a Self Assessment return for the 2025/26 tax year for the first time — because you started self-employment, received rental income, earned over £100,000 or had untaxed income — you must register with HMRC by 5 October 2026. The online filing deadline is 31 January 2027.
- Register at gov.uk/register-for-self-assessment
- Allow 10 working days for your Unique Taxpayer Reference (UTR) to arrive
- First-time filers: budget for Payments on Account if your bill exceeds £1,000
- Missed 2024/25? HMRC late filing penalties start at £100 — file as soon as possible
June Payslip: What to Check
June is a good month to review your payslip and tax code now that the new tax year is two months in. Common issues to look out for:
- Tax code: should be 1257L for most employees — check for W1/M1 or BR suffixes which may indicate an emergency code
- NI category: most employees are category A — check yours is correct, especially if you recently changed employer
- Pension: confirm your salary sacrifice or auto-enrolment contribution is deducting correctly at the new tax year rates
- Student loan: repayments should have restarted if you had a payroll break — check the correct plan is being applied
- NLW: if you are paid at or near minimum wage, verify your new rate has been applied since April
Mortgage Rates: June 2026 Update
The Bank of England base rate remained at 4.25% following the June 2026 Monetary Policy Committee meeting. Fixed mortgage rates have edged down through Q1 and Q2 2026 — five-year fixes are now available from around 4.1% for borrowers with larger deposits. If your fixed term ends this year, it is worth starting to compare deals three to six months in advance.
Coming Up: What to Watch in July 2026
- 31 July 2026: Second Payment on Account deadline for 2025/26 Self Assessment
- Spring Statement follow-up: any secondary legislation from the March 2026 statement may take effect
- ONS earnings data release: updated Average Weekly Earnings figures for April 2026
- Pension contributions: end of Q1 2026/27 — a good point to review contribution levels before the summer
Frequently Asked Questions
Frequently Asked Questions
Marcel Tonet
AAT Qualified · CeMAP Qualified · Tech & Financial Services
Marcel is an AAT-qualified accounting technician and CeMAP-qualified mortgage adviser with a career spanning technology and the UK financial services industry. He built and maintains Salary Take Home UK, updating all tax rates and thresholds each April for the new tax year.
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