When reviewing compliance requirements for the 2026/27 tax year, many professionals ask: did the tax return threshold change for high-earners? The short answer is yes. The government has fundamentally shifted the filing criteria, meaning that a high salary alone no longer triggers an automatic obligation to file a Self Assessment tax return.
Below, we exhaustively detail the filing thresholds, exceptions, and allowances applicable to high-earning individuals for the 2026/27 tax year.
Removal of the PAYE-only income threshold
Historically, HM Revenue & Customs (HMRC) required individuals earning over a specific threshold to file a Self Assessment return, even if their income was taxed entirely through Pay As You Earn (PAYE). This threshold stood at £100,000 before rising to £150,000 for the 2023/24 tax year.
However, the government abolished this requirement entirely from the 2024/25 tax year onwards. Consequently, for the 2026/27 tax year, high-earning individuals who receive their income exclusively through PAYE do not need to file a tax return solely because of the size of their salary.
Note on authority divergence: While HMRC’s Employment Income Manual at EIM71410 still references the £150,000 threshold for 2024-25 , the Autumn Statement 2023 announcement removing the threshold altogether represents the enacted policy change and takes precedence .
High Income Child Benefit Charge (HICBC)
Even with the general income threshold removed, high earners may still need to file a return if they or their partner receive Child Benefit.
Under section 681B of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA 2003), a person becomes liable to the HICBC if their adjusted net income exceeds £60,000 and they (or their partner) receive Child Benefit. The government increased this threshold from £50,000 to £60,000 on 6 April 2024, and this limit remains in place for 2026/27.
The charge applies at a rate of 1% for every £200 of income above the £60,000 threshold.
- Application: If a taxpayer has an adjusted net income of £70,000, they must repay 50% of their Child Benefit.
- Full withdrawal: The charge fully offsets the Child Benefit once the taxpayer’s adjusted net income reaches £80,000.
Individuals liable to the HICBC must register for Self Assessment to declare and pay the charge. Alternatively, taxpayers can elect to opt out of receiving Child Benefit payments to avoid the Self Assessment filing obligation altogether.
Sole traders, landlords, and Making Tax Digital (MTD)
For high-earners who supplement their PAYE income with self-employment or property income, the 2026/27 tax year brings significant changes. Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) officially launches on 6 April 2026.
Sole traders and landlords must use MTD-compatible software to keep digital records and submit quarterly updates if their total qualifying gross income exceeds £50,000. If a taxpayer’s qualifying income drops below this threshold for three consecutive tax years, they may choose to opt out of the MTD regime.
Untaxed income: Dividends and Capital Gains
High-earners often hold substantial investment portfolios, which carry separate reporting thresholds.
Dividend Income
The Dividend Allowance for the 2026/27 tax year is £500. Taxpayers must report dividend income exceeding this allowance to HMRC and pay tax based on their marginal rate band:
- Basic rate: 10.75%
- Higher rate: 35.75%
- Additional rate: 39.35%
Capital Gains Tax (CGT)
The Annual Exempt Amount for individuals is £3,000 for the 2026/27 tax year. Taxpayers must file a Self Assessment return to report and pay CGT on overall gains exceeding this £3,000 allowance. For trusts, the allowance is limited to £1,500.
Summary of 2026/27 Tax Thresholds and Filing Triggers
| Category | Provision / Event | 2026/27 Threshold / Amount | Outcome / Filing Requirement |
|---|---|---|---|
| PAYE Income | Autumn Statement 2023 | N/A (Threshold removed) | No automatic SA filing required purely for high PAYE income. |
| HICBC | s 681B ITEPA 2003 | £60,000 (Adjusted Net Income) | SA return required to report and pay the charge, unless opted out of Child Benefit. |
| MTD for ITSA | Launching 6 April 2026 | £50,000 (Qualifying gross income) | Must keep digital records and submit quarterly updates via software. |
| Dividends | Dividend Allowance | £500 | Must report dividend income over £500. |
| Capital Gains | Annual Exempt Amount | £3,000 | Must report gains exceeding £3,000. |
| Personal Allowance | s 35 ITA 2007 | £12,570 (Frozen to 2028) | Reduced by £1 for every £2 of income over £100,000. |
For completeness, remember that the Personal Allowance remains frozen at £12,570 through to the 2027/28 tax year. High-earners continue to lose their Personal Allowance at a rate of £1 for every £2 of adjusted net income above £100,000 under section 35(2) of the Income Tax Act 2007.
Next steps: Review your clients’ adjusted net income calculations to confirm whether they fall within the £60,000 to £80,000 HICBC taper band for 2026/27, and assess their readiness for MTD for ITSA if they possess property or trading income over £50,000.
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