What is a tax year?
The UK tax year runs from 6 April to 5 April the following year, and is the period HMRC uses for income tax, National Insurance and Capital Gains Tax.
What the tax year means
The 2026/27 tax year runs from 6 April 2026 to 5 April 2027. Income tax, National Insurance, Capital Gains Tax and most personal allowances are worked out for each tax year, and many allowances reset on 6 April, including the personal allowance, the dividend allowance, the Capital Gains Tax exempt amount and ISA subscriptions.
The odd start date is a historical accident. The old tax year began on Lady Day, 25 March. When Britain moved to the Gregorian calendar in 1752 and lost eleven days, the Treasury moved the start to keep a full year of tax, which eventually settled on 6 April.
Example
A sole trader's timeline for the 2026/27 tax year:
| Date | Event |
|---|---|
| 6 April 2026 | Tax year starts |
| 5 April 2027 | Tax year ends |
| 5 October 2027 | Deadline to register, if self-employed for the first time |
| 31 January 2028 | Online return filed and balance of tax paid, with the first payment on account for 2027/28 |
| 31 July 2028 | Second payment on account for 2027/28 |
Since the 2024/25 tax year, sole traders and partners are taxed on the profits of the tax year itself. If your accounts end on another date, profits are apportioned to fit, which is why many now choose 31 March or 5 April as their year end.
Tax months and payroll
Payroll follows the same calendar. Tax month 1 runs from 6 April to 5 May, tax month 2 from 6 May to 5 June, and so on, which is why PAYE payments fall due on the 22nd.
Why it matters for your business
Decisions made before 5 April can change the tax for the whole year. Pension contributions, the timing of dividends, using a spouse's allowances and selling assets in one tax year rather than another all depend on the tax year boundary. Payroll also runs on tax months from the 6th to the 5th. Cloudkeepers reviews clients' positions each spring so nothing is missed.
Tax year vs financial year
Companies do not use the 6 April tax year. Their accounts follow their own financial year, and Corporation Tax rates are set for financial years running 1 April to 31 March.
Common questions
It dates back to 1752, when Britain switched calendars and skipped eleven days. To avoid losing tax revenue, the start of the tax year was moved from 25 March to 5 April, and a later adjustment for a skipped leap day in 1800 moved it to 6 April, where it has stayed.
No, but it is simpler. Since basis period reform, profits are taxed by tax year, so any other year end means splitting profits between two tax years. A 31 March or 5 April year end avoids that and makes estimates and payments easier to follow.