What is Tax Year?

Full Definition

The UK tax year (sometimes called the fiscal year) runs from 6 April to 5 April the following year, rather than matching the calendar year -- so the 2026/27 tax year runs from 6 April 2026 to 5 April 2027. Almost every personal tax allowance and threshold resets on this cycle: the Personal Allowance, ISA allowance, Capital Gains Tax annual exempt amount, dividend allowance, pension annual allowance and Gift Aid all operate on a "use it or lose it" basis within a single tax year, with very limited ability to carry unused amounts forward (pension annual allowance being the main exception, allowing up to three years of unused allowance to be carried forward). The odd 6 April start date is a historical quirk dating back to the old Julian-to-Gregorian calendar switch in 1752, when 11 days were dropped from the calendar and the Treasury moved the start of its financial year to preserve a full 365 days of tax collection, eventually settling on 6 April after a further adjustment in 1800. Self Assessment tax returns, PAYE tax codes, and most HMRC deadlines (such as the 31 January payment and filing deadline) are all built around this 6 April to 5 April cycle, and it should not be confused with the UK government's financial year for public spending purposes, which happens to run on the same dates but is set for a different, budgetary reason.

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