Key takeaways
- Start with the basics: check your tax code and claim every allowance and relief you are entitled to.
- Employees can claim for uniforms, professional subscriptions and business mileage, but the home working deduction ended on 6 April 2026.
- Pension contributions are the biggest single lever, with relief at your highest rate of tax.
- Couples should use both partners' allowances, including the £1,260 Marriage Allowance where one earns less than £12,570.
- Savings and investments in ISAs are completely tax-free.
Reducing Income Tax legally is mostly about using reliefs the system already offers. Many people overpay simply because their tax code is wrong or they never claim relief they are entitled to. This guide starts with those quick wins and moves on to the bigger planning tools.
1. Check your tax code
Your tax code tells your employer or pension provider how much tax-free pay you get. The standard code for 2026/27 is 1257L. A wrong code can mean overpaying for months.
Check it in your HMRC online account or the HMRC app. Common problems:
- an emergency code (with W1, M1 or X at the end) used for too long after starting a new job
- a code that still includes a company car or medical benefit you no longer have
- underpaid tax from an earlier year being collected when it should not be
- a second job or pension using the wrong code
Our guides to tax codes and emergency tax codes explain how to read and fix them.
2. Claim the allowances you are entitled to
| Allowance | 2026/27 | Who can claim |
|---|---|---|
| Marriage Allowance | Transfer £1,260, worth up to £252 | Couples where one earns under £12,570 and the other is a basic rate taxpayer |
| Blind Person’s Allowance | £3,250 | Registered blind people, or those certified severely sight impaired in Scotland or Northern Ireland |
| Trading allowance | £1,000 | Small amounts of self-employed or side-hustle income |
| Property allowance | £1,000 | Small amounts of property income |
| Rent a Room relief | £7,500 | Letting furnished rooms in your own home |
Marriage Allowance can be backdated for up to four previous tax years, so a couple who has never claimed can receive a refund now.
3. Claim work expenses (employees)
If you pay for things you need for your job and your employer does not reimburse you, you may be able to claim tax relief:
- uniforms and protective clothing: many occupations have a flat rate allowance, so you do not need receipts
- professional fees and subscriptions to approved bodies, such as the ICAEW, ACCA or nursing and midwifery registration
- business mileage in your own vehicle: if your employer pays less than 55p a mile for the first 10,000 business miles (25p after), you can claim relief on the difference
- tools and equipment you must buy for your job
From 6 April 2026 employees can no longer claim tax relief for the extra household costs of working from home. Employers can still pay you up to £6 a week tax-free towards them, and from the same date they can reimburse home working equipment tax-free.
You claim through HMRC’s online service, or on your Self Assessment return if you file one. Claims can go back four years.
4. Pay into a pension
Pension contributions get tax relief at your highest rate:
- a basic rate taxpayer puts in £80 and the pension receives £100
- a higher rate taxpayer can claim another £20 back, so £100 in the pension costs £60
- above £100,000, contributions can also restore the Personal Allowance, giving effective relief of 60%
Salary sacrifice saves National Insurance as well. See tax relief on pension contributions.
5. Use Gift Aid
If you give to charity, Gift Aid adds 25% to your donation at no cost to you, and higher rate taxpayers can claim the difference between 40% and 20% relief on their Self Assessment return. See Gift Aid tax relief.
6. Hold savings and investments tax-efficiently
- ISAs: £20,000 a year, completely tax-free; see ISA tax benefits
- Personal Savings Allowance: £1,000 of interest tax-free for basic rate taxpayers and £500 for higher rate taxpayers
- Dividend Allowance: £500 of dividends tax-free
- Premium Bonds: prizes are tax-free
7. Share income with your spouse or civil partner
If one partner pays a higher rate of tax, moving savings, investments or a share of a rental property to the other can reduce the household’s tax. Transfers between spouses are free of Capital Gains Tax, but the gift must be genuine and outright.
8. If you are self-employed
- claim every allowable business expense; see our guide to sole trader expenses
- use capital allowances for equipment and vans, including the £1 million Annual Investment Allowance
- consider whether your profits are high enough that a limited company would be more efficient
- make pension contributions, which reduce your tax and, if your income is between £60,000 and £80,000, the Child Benefit charge
9. Investment schemes for experienced investors
The Enterprise Investment Scheme (EIS), Seed Enterprise Investment Scheme (SEIS) and Venture Capital Trusts (VCTs) give Income Tax relief on investments in small, unquoted companies. From 6 April 2026 VCT relief fell from 30% to 20%. These investments are high risk and illiquid, so they suit only experienced investors who can afford to lose the money.
Frequently asked questions
What is the easiest way to pay less Income Tax?
Check your tax code is right, then claim any allowances and job expenses you are missing. After that, pension contributions are the most effective tool for most people.
Can I still claim tax relief for working from home?
Not for 2026/27 onwards. The deduction for employees’ unreimbursed home working costs was removed from 6 April 2026. Your employer can still pay up to £6 a week tax-free.
How far back can I claim tax relief?
Usually four tax years. For example, claims for 2022/23 must be made by 5 April 2027.
Does salary sacrifice reduce my tax?
Yes. It reduces your taxable salary and National Insurance. From April 2029 sacrificed pension contributions above £2,000 a year will attract National Insurance, but Income Tax relief continues.
Sources
Rates, thresholds and rules in this guide were checked against HMRC and GOV.UK guidance in October 2026. Tax rules change, so check the current position on GOV.UK or with a qualified adviser before acting. This guide is general information, not personal advice.