Income tax is paid on earnings from employment and profits from self-employment.
It is also paid on some benefits, external and pensions, income from renting out property, and returns from savings, external and investments, external above certain limits.
The basic rate is 20% and is paid on annual earnings between £12,571 and £50,270.
The higher rate is 40%, and is paid on earnings between £50,271 and £125,140.
Once you earn more than £100,000, you also start losing the £12,570 tax-free personal allowance. You lose £1 of your personal allowance for every £2 that your income goes above £100,000.
Anyone earning more than £125,140 a year no longer has any tax-free personal allowance.
An additional rate of income tax of 45% is paid on all earnings above £125,140 a year.
These rates apply in England, Wales and Northern Ireland.
Some income tax rates are different, external in Scotland, where a new 45% band took effect in April 2024. At the same time the top rate also rose from 47% to 48%.