# What frozen thresholds cost a household url: https://whereyourmoneygoes.co.uk/what-frozen-thresholds-cost-a-household/ updated: 29 September 2026 licence: Our words, analysis, charts and derived calculations: CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/), credit [Tekstak Ltd](https://tek-stak.co.uk). Figures: each source's own licence, listed under Sources. publisher: [Tekstak Ltd](https://tek-stak.co.uk) # What frozen thresholds cost a household Last updated 29 September 2026. Figures refresh every night. [How each figure is worked out](/methodology/). In 2026–27, someone earning **£35,000 pays about £979 more** in income tax and National Insurance than they would if the thresholds had risen with inflation since 2021; at £50,000 it is £979, and at £70,000 £2,968. Spread across all 28.6 million households, the OBR's estimate for the income tax freezes alone comes to about **£1,190 a household**. The method and every assumption are below. Figure as of 1 March 2026. Source: [Office for Budget Responsibility](https://obr.uk/efo/), [Office for Budget Responsibility](https://obr.uk/docs/dlm_uploads/OBR_Economic_and_fiscal_outlook_November_2025.pdf). ## Key figures - £979Extra income tax and National Insurance a year at £35,000 Against thresholds that had risen with inflation 2026–27 - £2,968Extra income tax and National Insurance a year at £70,000 Against thresholds that had risen with inflation 2026–27 - £42.3bnRaised by the threshold freezes in 2026–27 (OBR estimate) ▲ As of 1 March 2026 - £1,480Per household, all freezes (28.6 million households) ▲ As of 1 March 2026 Source: [Office for Budget Responsibility](https://obr.uk/efo/). ## What does it cost at each salary? **Extra income tax and National Insurance a year because of the freezes, 2026–27** **The numbers behind this chart** | Year | Income tax | National Insurance | | --- | --- | --- | | £25,000Details | £700 | £279 | | National Insurance£279 | | | | £35,000Details | £700 | £279 | | National Insurance£279 | | | | £50,000Details | £700 | £279 | | National Insurance£279 | | | | £70,000Details | £3,540 | £-572 | | National Insurance£-572 | | | Figure as of 1 March 2026. Source: [Office for Budget Responsibility](https://obr.uk/efo/), [Office for Budget Responsibility](https://obr.uk/docs/dlm_uploads/OBR_Economic_and_fiscal_outlook_November_2025.pdf). ### What does this mean for you? Put in a yearly salary to see what the frozen thresholds add to your income tax and National Insurance in 2026–27. Your salary before tax £ On £35,000 the freezes cost you about **£979 a year**, around £82 a month: £700 in income tax and £279 in National Insurance, against thresholds that had risen with inflation. Employee, England, Wales or Northern Ireland rates, no pension contributions or other income. Indexed thresholds are the OBR’s: a Personal Allowance of £16,070 and a higher-rate threshold of £64,470. Up to £99,000, below the allowance taper. A negative National Insurance figure means the frozen upper earnings limit saves you a little. Figure as of 1 March 2026. Source: [Office for Budget Responsibility](https://obr.uk/efo/), [Office for Budget Responsibility](https://obr.uk/docs/dlm_uploads/OBR_Economic_and_fiscal_outlook_November_2025.pdf). Between the frozen higher-rate threshold and where it would have been, the cost is the same at every salary, because it all comes from the Personal Allowance; above that, the higher-rate threshold adds to it. National Insurance can be negative: the upper earnings limit is frozen too, and because pay above it is charged at 2% rather than 8%, a frozen limit keeps some higher earners' pay in the cheaper band. For most salaries the income tax effect is far larger. ## What is the national total, per household? £42.3bn All threshold freezes, 2026–27 (OBR) Figure as of 1 March 2026. Source: [Office for Budget Responsibility](https://obr.uk/efo/). £1,480 Per household, all freezes (28.6 million households) Figure as of 1 March 2026. Source: [Office for Budget Responsibility](https://obr.uk/efo/). £1,190 Per household, income tax Personal Allowance and higher-rate freezes only Figure as of 1 March 2026. Source: [Office for Budget Responsibility](https://obr.uk/efo/). A per-household average is a way of sizing the total, not a bill anyone receives: households that pay no income tax pay none of it, and higher earners pay far more than the average. Household count: 28.6 million UK households, from the ONS [Families and households in the UK: 2024](https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/families/bulletins/familiesandhouseholds/2024). ## How is it worked out, and what does it assume? - Income tax and employee National Insurance are worked out for one employee at each salary, at 2026–27 rates, with the thresholds actually in force. - The same is worked out with the Personal Allowance at £16,070 and the higher-rate threshold at £64,470: the OBR's estimate of where each would be had it risen with inflation since the freeze began (table 3.19 of the March 2026 outlook). - The National Insurance primary threshold and upper earnings limit are aligned to those two by law, so they move with them in the counterfactual. - The difference is the cost of the freeze. Rates are held at today's levels in both, so the comparison isolates the thresholds. - No pension contributions, no other income, England, Wales or Northern Ireland rates. Scotland's bands differ. - Allowance cuts on savings, dividends and gains are not included, because what they cost depends entirely on how much someone holds outside an ISA. The [allowance cuts page](/allowance-cuts/) works two examples. [Work out your take-home pay after income tax and National Insurance](https://howlongisit.co.uk/uk-salary-calculator) ## Is this the right comparison? ### Why inflation-linked uprating is the benchmark - It is the default in law: the statute uprates by CPI unless Parliament decides otherwise. - It is the benchmark the OBR uses to cost the freezes. - It keeps the real value of each threshold constant, which is what "no change" means in real terms. ### Why it overstates or understates - In the 2010s allowances rose faster than inflation, so a longer view would show a smaller gap. - Wages rather than prices could be the benchmark, which would make the gap larger. - Governments facing the same deficit would have raised the money some other way. ## Common questions How much do frozen thresholds cost me? Roughly £979 at £25,000, £979 at £35,000, £979 at £50,000, £2,968 at £70,000 a year in 2026–27, against thresholds that had risen with inflation. ## Sources for this page | Source | Publisher | Figures as of | Updated | Licence | | --- | --- | --- | --- | --- | | [Economic and fiscal outlook, March 2026: detailed receipts tables](https://obr.uk/efo/) | Office for Budget Responsibility | 1 March 2026 | semiannual | [Open Government Licence v3.0](https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/) | | [Office for Budget Responsibility, Economic and fiscal outlook, November 2025, Box 3.3](https://obr.uk/docs/dlm_uploads/OBR_Economic_and_fiscal_outlook_November_2025.pdf) | Office for Budget Responsibility | 22 September 2026 | semiannual | [Open Government Licence v3.0](https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/) | Each source's figures are used under the licence shown. Our own words, analysis, charts and derived calculations are ours, under [CC BY 4.0](https://creativecommons.org/licenses/by/4.0/). ## Related pages - [Next in this section: Hidden marginal tax rates](https://whereyourmoneygoes.co.uk/hidden-marginal-tax-rates/) - [How much is council tax and what does it pay for?](https://whereyourmoneygoes.co.uk/council-tax/) - [How much of my energy bill is tax?](https://whereyourmoneygoes.co.uk/tax-on-energy-bills/) - [How is each figure on this site worked out?](https://whereyourmoneygoes.co.uk/methodology/) ## More from this publisher - [UK tax calculators](https://howlongisit.co.uk) Published by [Tekstak Ltd](https://tek-stak.co.uk). Our words, analysis, charts and derived calculations: CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/), credit [Tekstak Ltd](https://tek-stak.co.uk). The figures belong to the publishers listed under Sources and are used under their licences. Figures last updated 29 September 2026.