Budget 2026
Police Pay, Pensions and Tax
What is already confirmed, what is not known and what to check on the day. This page contains no predictions. It will be rewritten from the published documents after the statement.
Independent information, not advice · Last updated 1 October 2026 · England and Wales unless stated
Budget outcome: not yet announced
The Budget is on Wednesday 28 October 2026. Nothing in it has been published. Every figure on this page is the rule in force on 1 October 2026.
Last updated: 1 October 2026. We do not forecast what the Chancellor will announce, and we do not repeat press speculation.
The Budget is on Wednesday 28 October 2026 and nothing in it is known yet. Today the rules are: income tax thresholds frozen until April 2031, employee NI at 8% and 2%, a £60,000 pension annual allowance and a £268,275 lump sum allowance. Police pay is not set in the Budget: the 3.5% award from 1 September 2026 was decided separately. Check back after the statement.
Key dates: what has happened and what is scheduled
HM Treasury confirmed on 31 July 2026 that the Budget will be on Wednesday 28 October. In a letter to the Treasury Committee the same day, the Chancellor said he had asked the Office for Budget Responsibility to prepare an economic and fiscal forecast "for publication on 28 October 2026", accompanied by the Budget. Several changes that affect officers are already law and will happen whatever the Budget says; others are only scheduled events.
| Date | What | Status | Source |
|---|---|---|---|
| 19 May 2026 | HM Treasury sets the SCAPE discount rate at CPI + 2% (was CPI + 1.7%); GAD issues lower 1987 commutation factors on 21 May | Happened | HCWS37; GAD letter 21 May 2026 |
| 15 July 2026 | Police officer pay award: 3.5% for all ranks from 1 September 2026 | Happened | HCWS264 |
| 31 July 2026 | Chancellor confirms the Budget date and asks the OBR for a forecast | Happened | HM Treasury; letter to Treasury Committee |
| 21 October 2026 | ONS publishes September 2026 CPI, the figure used for the April 2027 public service pension increase | Scheduled | ONS release calendar |
| 28 October 2026 | Budget statement and OBR economic and fiscal forecast | Scheduled | HM Treasury |
| 6 April 2027 | Most unused pension funds and pension death benefits come into scope of inheritance tax | Already law | Finance Act 2026 s.71 |
| April 2027 | New employer contribution rates for public service schemes from the 2024 valuations (paid by forces, not deducted from your pay) | Announced | HCWS37 |
| Tax year 2029-30 | National Insurance charged on salary-sacrificed pension contributions above £2,000 a year | Already law | NIC (Employer Pensions Contributions) Act 2026 s.1 |
| 5 April 2031 | End of the current freeze on the Personal Allowance (£12,570) and basic rate limit (£37,700) | Already law | Finance Act 2026 s.10 |
"Already law" means it is in an Act of Parliament that we read on legislation.gov.uk on 1 October 2026. A later Budget or Act could still change it, but nothing has been announced.
Income tax and National Insurance in force now (2026/27)
The current tax year runs from 6 April 2026 to 5 April 2027. These are the rates and thresholds a Budget would be changing from. Police pension contributions come off pay before income tax is worked out, but National Insurance is charged on full gross pay, which is why the two thresholds bite at different salaries.
| Item (England, Wales, NI) | 2026/27 | Fixed until |
|---|---|---|
| Personal Allowance | £12,570 (0%), reduced by £1 for every £2 of adjusted net income over £100,000 | 5 April 2031 (Finance Act 2026 s.10) |
| Basic rate 20% | £12,571 to £50,270 (basic rate limit £37,700) | 5 April 2031 (s.10) |
| Higher rate 40% | £50,271 to £125,140 | Threshold follows the two figures above |
| Additional rate 45% | Over £125,140 | Rates are set each year in a Finance Act |
| Employee NI (category A) | 8% from £12,570 to £50,270 a year (£1,048 to £4,189 a month); 2% above | Government policy: thresholds aligned to 2030-31 |
The thresholds have a long history of being frozen. Finance Act 2021 fixed the Personal Allowance and basic rate limit at their 2021 levels to April 2026, Finance Act 2023 extended that to April 2028, and Finance Act 2026 (announced at Budget 2025 on 26 November 2025) extended it again to 5 April 2031. HMRC's policy paper says the NI primary threshold and upper earnings limit will stay aligned with them; NI thresholds are set year by year in regulations, so for later years that is stated policy rather than law.
Scottish taxpayers pay income tax at Scottish rates and bands (starter 19% to top 48% in 2026/27), set by the Scottish Parliament in its own budget. The Personal Allowance and National Insurance are UK-wide, so a UK Budget change to either would reach Police Scotland officers too. See Police Scotland pay scales.
Pension tax limits in force now
These limits matter most to officers in the 1987 and 2006 final-salary schemes at the point of promotion or retirement. They are set in tax law, so they are among the things a Budget can change. As at 1 October 2026, none has been announced.
| Limit | 2026/27 | What it means for officers |
|---|---|---|
| Annual allowance | £60,000; unused allowance can be carried forward from the previous 3 tax years | Measured on the growth of your defined benefit pension in the year, not on what you pay in |
| Tapered annual allowance | Applies if threshold income is over £200,000 and adjusted income over £260,000; minimum £10,000 | Needs income far above federated or superintending pay; most officers are not affected |
| Lump sum allowance | £268,275 of tax-free lump sums across all pensions (normally 25% of the value) | GOV.UK says it is not reduced for uniformed services members, including police, taking benefits before 55 |
| Lump sum and death benefit allowance | £1,073,100 | Covers serious ill-health lump sums and certain lump sum death benefits |
How a promotion or pay rise can push a final-salary pension over the annual allowance, how pension savings statements work and how McCloud changes past years are covered in our police pension annual allowance 2026 guide. For the tax-free cash rules scheme by scheme, see lump sum allowance and tax-free cash.
Changes already legislated, whatever the Budget says
Budget 2025 (26 November 2025) announced several measures that are now in Acts of Parliament. They take effect on their own dates unless Parliament changes them.
- Thresholds frozen to 5 April 2031. Personal Allowance £12,570 and basic rate limit £37,700 for 2028-29, 2029-30 and 2030-31 (Finance Act 2026 s.10). HMRC estimated this brings 700,000 more people into income tax by 2030-31 compared with CPI indexation.
- Inheritance tax on pensions from 6 April 2027. Most unused pension funds and pension death benefits will be treated as part of the estate (Finance Act 2026 ss.66 to 71). HMRC says death in service benefits from a registered scheme, and dependants' scheme pensions from a defined benefit arrangement, are excluded. For defined benefit schemes the Act counts lump sum death benefits. Ask your administrator which, if any, police death benefits would be in scope for you.
- Salary sacrifice and NI from 2029-30. NI will be charged on pension contributions made through salary sacrifice above £2,000 a year (National Insurance Contributions (Employer Pensions Contributions) Act 2026 s.1). It applies only to salary sacrifice arrangements.
- Higher tax on dividends, savings and property income. Dividend ordinary and upper rates rose to 10.75% and 35.75% from 2026-27 (s.4). For 2027-28 the savings rates are 22%, 42% and 47% (s.5) and new property income rates are 22%, 42% and 47% (s.7). Relevant if you have savings outside an ISA or let a property; see buy-to-let for police officers.
What a Budget can and cannot do to police pay
Police officer pay in England and Wales is not set in the Budget. The Home Secretary sets pay and allowances in regulations and determinations under section 50 of the Police Act 1996, after the Police Remuneration Review Body (PRRB) reports on matters the Home Secretary refers to it (section 64B). For 2026/27 the PRRB recommended 3.9%; the Government awarded 3.5% to all ranks from 1 September 2026, announced on 15 July 2026 in written statement HCWS264, calling it "the highest award that is manageable within existing police force and Home Office budgets".
That last phrase is where the Budget comes in. The Budget sets the Government's tax and spending plans; the Home Office then decides what pay it can fund, and forces receive grant through the annual police grant report under section 46(2) of the Police Act 1996. For 2026-27 the final settlement (28 January 2026) gave the policing system up to £21.0 billion. To help with the 3.5% award the Home Office is adding £84m in 2026-27, £144m in 2027-28 and £145m in 2028-29, from contingency budgets (HCWS264).
Confirmed: 3.5% from 1 September 2026 for all ranks; extra funding as above; the 2026-27 funding settlement.
Not known: the 2027/28 award (no remit letter published by 30 September 2026), the 2027-28 police funding settlement, and whether the Budget changes the Home Office's spending plans.
Police staff and PCSOs are paid under a separate Police Staff Council negotiation, so the officer award does not apply to them; see police staff pay rise 2026. For how the officer process runs from remit letter to payslip, see the police pay award process and the police pay rise 2026/27 guide.
Police pension rules: what changes them, and the 2026 factor change
Police pension benefits and member contributions are set by scheme regulations made by the Home Secretary: the 1987 scheme (SI 1987/257), the 2006 scheme (SI 2006/3415) and the 2015 scheme (SI 2015/445, made under the Public Service Pensions Act 2013). A Budget speech cannot change them on its own; regulations would be needed. For the 2015 scheme the 2013 Act adds two protections:
- Protected elements (section 22). Until 31 March 2040, changing the scheme's career-average design, member contribution rates or accrual rates requires the Home Office to consult with a view to reaching agreement and to lay a report before Parliament.
- Retrospective changes (section 23). Regulations with retrospective provision that has significant adverse effects on members' pensions need the consent of the people affected or their representatives.
The most recent contribution change shows the normal route: the 2015 scheme bands from 1 April 2026 were set by the Police Pensions (Amendment) Regulations 2026 (SI 2026/267), not by a Budget:
| Relevant pensionable pay | Full rate |
|---|---|
| Up to £37,035 | 12.88% |
| Over £37,035 to under £79,588 | 13.88% |
| £79,588 or more | 14.22% |
The May 2026 SCAPE change was not a Budget measure
On 19 May 2026 HM Treasury told Parliament (HCWS37) that the SCAPE discount rate for the 2024 valuations would be CPI + 2% a year, up from CPI + 1.7%, based on the OBR's July 2025 long-term growth figures. The valuations will set new employer contribution rates from April 2027. The Government Actuary's Department then reviewed its factors and on 21 May 2026 issued new 1987 scheme commutation factors, in force immediately. A higher discount rate means each £1 of pension given up buys less cash:
| Age at retirement | Factor to 20 May 2026 | Factor from 21 May 2026 | Change | Per £1,000 a year commuted |
|---|---|---|---|---|
| 50 | 26.90 | 25.55 | -5.0% | -£1,350 |
| 52 | 25.90 | 24.69 | -4.7% | -£1,210 |
| 55 | 24.30 | 23.22 | -4.4% | -£1,080 |
| 58 | 22.50 | 21.63 | -3.9% | -£870 |
| 60 | 21.40 | 20.61 | -3.7% | -£790 |
| 65 | 18.20 | 17.76 | -2.4% | -£440 |
GAD 1987 scheme Table 1 (3 April 2023 and 21 May 2026), exact ages, retirement from active service. Where HMRC's 25% limit or the 1987 scheme's 2.25 times cap (under 30 years' service) applies, the effect is different: see 2026 police pension lump sum changes and SCAPE explained.
The 2006 scheme's automatic lump sum (four times the pension) and the 2015 scheme's £12 per £1 rate are fixed in the regulations and did not change. GAD's letter says it reviews factors "as and when" it judges necessary and does not release details of reviews until new factors are issued. Pensions in payment rise each April by a separate Treasury order that follows September CPI (3.8% in April 2026); the September 2026 figure is published on 21 October 2026. See police pension increase 2027.
The pension commutation calculator uses the GAD 1987 factors in force from 21 May 2026, the 2006 automatic lump sum and the 2015 £12 per £1 rate, with HMRC's limits. Useful for seeing where you stand now, so you can tell on Budget day whether anything announced touches your figures. Your administrator's quote is the one that counts.
Who decides what: Budget levers and police money
A quick map of which decisions a Budget can make directly, which it can only influence and which it does not touch.
| Lever | Who decides | Legal route | Can the Budget change it? |
|---|---|---|---|
| Police officer pay (England and Wales) | Home Secretary, after a PRRB report | Police Regulations and determinations under Police Act 1996 s.50; PRRB under s.64B | Not directly. The Budget sets overall spending, not the award. |
| Police staff pay | Police Staff Council negotiations (or the force, locally) | Collective agreement | Not directly. |
| Grant funding for forces | Home Secretary, approved by the Commons | Annual police grant report, Police Act 1996 s.46(2) | Indirectly: the Budget can change the Home Office's spending envelope. |
| Income tax rates | Parliament, on the Chancellor's proposal | A Finance Act each year (2026-27 rates: Finance Act 2026 s.2) | Yes, this is what a Budget does. |
| Income tax thresholds | Parliament | Income Tax Act 2007, frozen to 2030-31 by Finance Act 2026 s.10 | Yes, by new legislation. |
| National Insurance rates and thresholds | Parliament / HM Treasury | Social Security Contributions and Benefits Act 1992 and annual regulations | Yes. |
| Pension tax limits (annual allowance, lump sum allowance) | Parliament | Finance Act 2004 as amended | Yes. |
| Police pension scheme rules and contribution rates | Home Secretary | Scheme regulations (1987, 2006, 2015); 2015 scheme under Public Service Pensions Act 2013 | Not directly. Changes need regulations, and the 2013 Act adds consultation steps. |
| Annual increase to pensions in payment | HM Treasury order, following the DWP review | Social Security Pensions Act 1975 s.59 | No. It follows September CPI under the existing process. |
| SCAPE discount rate and GAD factors | HM Treasury (rate); Government Actuary (factors) | Directions under Public Service Pensions Act 2013 s.11; GAD tables | The rate can be changed at any time; the May 2026 change was not a Budget measure. |
Take-home sensitivity: what a 1-point or £1,000 change would mean
None of these changes has been announced or predicted. The table shows the arithmetic of six hypothetical changes, one at a time, so you can translate whatever is announced into pounds. It does not suggest any of them will happen.
Change in annual take-home pay against the 2026/27 rules, for basic pay only at calculated 2026/27 pay points (2025/26 official scale plus 3.5%), 2015 scheme contributions from 1 April 2026, England and Wales tax, no allowances, overtime, student loan or other deductions. Computed with the same pay engine as our salary calculator.
| Pay point (gross) | Take-home now | Basic rate 20% to 21% | Higher rate 40% to 41% | Employee NI main rate 8% to 9% | Personal Allowance +£1,000 (higher-rate threshold unchanged) | Higher-rate threshold +£1,000 (to £51,270) | NI primary threshold +£1,000 |
|---|---|---|---|---|---|---|---|
| Constable, pay point 1£32,255; pension 12.88% | £23,420 | −£155 | £0 | −£197 | +£200 | £0 | +£80 |
| Constable, pay point 4£36,335; pension 12.88% | £25,937 | −£191 | £0 | −£238 | +£200 | £0 | +£80 |
| Constable, pay point 7£52,015; pension 13.88% | £35,299 | −£322 | £0 | −£377 | +£200 | £0 | +£80 |
| Sergeant, pay point 4£58,175; pension 13.88% | £39,420 | −£375 | £0 | −£377 | +£200 | £0 | +£80 |
| Inspector, pay point 3 (outside London)£71,396; pension 13.88% | £46,021 | −£377 | −£112 | −£377 | +£200 | +£200 | +£80 |
| Chief inspector, pay point 3 (outside London)£75,709; pension 13.88% | £48,164 | −£377 | −£149 | −£377 | +£200 | +£200 | +£80 |
What the table shows, on these assumptions:
- Because pension contributions come off before tax, a top-scale constable (£52,015) has taxable pay of about £44,795 and pays no higher-rate tax, so a higher-rate change does nothing for them on basic pay.
- A sergeant at pay point 4 sits about £170 below the higher-rate threshold on taxable pay. Overtime is not pensionable, so a small amount of overtime in the year would take part of their pay into the 40% band. See police overtime after tax.
- National Insurance is charged on gross pay, so an NI rate change reaches further up the scale than a basic-rate change. Everyone earning above £50,270 gross pays 8% on the same band, which is why the NI column flattens from the top constable point upwards.
- The effects are symmetrical: a 1-point cut or a £1,000 threshold cut would move take-home by the same amounts in the other direction, except near a band edge.
- The 2015 contribution band is set by your previous scheme year's pensionable pay, not this year's, so the rate shown may not be yours.
The police salary calculator shows your 2026/27 take-home by rank and pay point, with London Weighting and South East allowances. Run it before 28 October and again once any change is in force to see the real difference.
How to read the Budget announcement
The speech is a summary. The detail is in documents published on the day and shortly after. At Budget 2025 the Budget document came out on 26 November 2025 and HMRC's overview of tax legislation and rates two days later. A checklist for reading them:
- Find the measure in the Budget document, not the headlines. Check the exact wording: "rate", "threshold", "allowance" and "relief" are different things.
- Check the start date. Personal tax changes usually start from a named tax year. A change for 2027-28 will not touch a 2026/27 payslip.
- Check where it applies. Income tax bands for Scottish taxpayers are set in Edinburgh. NI and pension tax are UK-wide.
- Announced is not legislated. Tax measures go through a Finance Bill. Read HMRC's tax information and impact note for who is affected.
- Separate tax from scheme rules. A pension tax change (allowances, inheritance tax) is not a change to your police pension scheme. A scheme change would need regulations from the Home Office.
- Look for public spending, not a pay figure. The Budget will not announce the 2027/28 police pay award; that comes after a PRRB report.
- Read the OBR forecast for inflation. It is a forecast, not a decision, but the pay review bodies and the Government use inflation evidence.
What to check on 28 October
Serving officers
- Income tax rates and the frozen thresholds
- Employee NI rates and thresholds
- Annual allowance and tapered allowance
- Salary sacrifice rules
- Home Office and police spending lines
- The OBR's inflation forecast
Near or in retirement
- Lump sum allowance and tax-free cash rules
- Inheritance tax on pensions (from April 2027)
- Income tax on pension income
- Anything on public service pensions or SCAPE
- September CPI (out 21 October) for the April 2027 increase
- Savings and property income tax rates
Then compare what was announced with the tables on this page. If nothing in a row changed, nothing changes for you on that point. If something did, note the start date and ask the people below how it applies to you.
Common mix-ups
"The Budget sets the police pay rise."
The Home Secretary sets officer pay after a PRRB report. The 2026/27 award (3.5%) was decided on 15 July 2026.
"The Treasury cut our lump sums in a Budget."
The SCAPE rate changed by written statement on 19 May 2026, not in a Budget. Only the 1987 commutation factors and other actuarial factors changed; pensions themselves did not.
"Thresholds rise with inflation from 2028."
Not any more. Finance Act 2026 froze the Personal Allowance and basic rate limit to 5 April 2031.
"Pension tax changes rewrite my scheme."
Tax limits and scheme rules are separate. Scheme rules change only through regulations, with extra protections for the 2015 scheme under the Public Service Pensions Act 2013.
"Inheritance tax will hit my widow's pension."
HMRC says dependants' scheme pensions from a defined benefit arrangement and death in service benefits are excluded from the April 2027 change.
"The Budget sets the April pension increase."
The increase follows September CPI through a Treasury order under the Social Security Pensions Act 1975. The Budget does not choose the figure.
What we could not verify, and what is not known
- Anything in the Budget. HM Treasury does not publish Budget measures in advance. We have not repeated press speculation and will not until the documents are out.
- Police funding for 2027-28. No 2027-28 police funding settlement had been published. Last year's came as a provisional settlement in December 2025 and a final one on 28 January 2026.
- The 2027/28 pay award. No PRRB remit letter for 2027/28 had been published as at 30 September 2026.
- New employer contribution rates. HCWS37 says rates from the 2024 valuations apply from April 2027; the figures were not published when we checked.
- Inheritance tax and specific police benefits. We have not checked scheme by scheme which police death benefits would count towards an estate from April 2027. Your administrator can tell you.
- Salary sacrifice in forces. We do not know which forces, if any, run pension salary sacrifice. Ask payroll.
- The OBR's own page. The OBR website blocked our automated check, so the forecast date is taken from the Chancellor's letter to the Treasury Committee.
- The official 2026/27 pay table. Pay points used in the take-home table are our calculation (2025/26 official scale plus 3.5%); see the pay rise guide for the current status.
Who to ask
- Your pension administrator for quotes, lump sum options, annual allowance statements and death benefit questions.
- Force payroll for tax codes, NI and any salary sacrifice arrangements.
- Your Police Federation, Superintendents' Association or union rep for what a change means for members.
- HMRC for your tax code and personal tax account.
- A regulated financial adviser before any large or irreversible pension decision, such as commuting, transferring or opting out. This page is information, not advice.
Budget 2026: FAQs
When is the Budget 2026?
Wednesday 28 October 2026. The Chancellor confirmed the date on 31 July 2026 and asked the Office for Budget Responsibility (OBR) to prepare an economic and fiscal forecast for publication the same day. This page will be rewritten from the published documents after the statement.
Will the Budget 2026 change police pensions?
Nothing has been announced. Police pension scheme rules and contribution rates are set by scheme regulations made by the Home Secretary, not by the Budget itself. The Budget can change pension tax (the annual allowance, lump sum limits, inheritance tax) and Treasury policy that feeds into actuarial factors. As at 1 October 2026 no change to any of these had been announced.
Does the Budget decide police pay?
No. Officer pay in England and Wales is set by the Home Secretary after a report from the Police Remuneration Review Body (Police Act 1996 s.50 and s.64B). The 2026/27 award of 3.5% from 1 September 2026 was announced on 15 July 2026 (HCWS264). The Budget sets overall public spending, which affects what the Government says is affordable in future rounds.
Will the Budget affect public sector pensions?
We do not know: nothing is published before the statement. What we can say is which parts a Budget can reach. Pension tax limits and inheritance tax are set in Finance Acts. Scheme benefits in the police 2015 scheme are protected elements under the Public Service Pensions Act 2013 s.22: changing contribution or accrual rates before 31 March 2040 requires consultation and a report to Parliament.
Are income tax thresholds frozen until 2031?
Yes, as the law stands. Finance Act 2026 s.10 keeps the Personal Allowance at £12,570 and the basic rate limit at £37,700 for every tax year up to 2030-31, so the higher-rate threshold stays at £50,270 until 5 April 2031. HMRC's policy paper says the NI primary threshold and upper earnings limit will stay aligned with them.
What are the income tax and National Insurance rates for 2026/27?
In England, Wales and Northern Ireland: 0% up to £12,570, 20% to £50,270, 40% to £125,140 and 45% above (GOV.UK). Employee Class 1 NI (category A) is 8% between £12,570 and £50,270 a year and 2% above (HMRC). Scottish taxpayers have separate income tax bands set by the Scottish Parliament; NI is UK-wide.
What is the pension annual allowance for 2026/27?
£60,000 (GOV.UK). It is tapered if your threshold income is over £200,000 and your adjusted income over £260,000, down to a minimum of £10,000, and unused allowance can be carried forward from the previous three tax years. For police officers the risk usually comes from a large rise in final-salary pension, for example on promotion, rather than from the contributions themselves.
How much of my police pension lump sum is tax-free?
HMRC's lump sum allowance is £268,275 across all your pensions, and the tax-free part is normally limited to 25% of the value (GOV.UK). GOV.UK says the allowance is not reduced for members of uniformed services schemes such as the police who take benefits before 55. Each scheme then has its own lump sum rules: the 2015 scheme pays £12 for each £1 a year of pension given up.
Did the Treasury cut police pension lump sums in 2026?
Not in a Budget. On 19 May 2026 HM Treasury set the SCAPE discount rate at CPI + 2% (from CPI + 1.7%) in a written statement (HCWS37). The Government Actuary then issued lower 1987 scheme commutation factors on 21 May 2026: about 3.7% to 5% lower between ages 50 and 60. The annual pension is not reduced.
Will my police pension be subject to inheritance tax from 2027?
The rules change on 6 April 2027 (Finance Act 2026 s.71). Most unused pension funds and pension death benefits will count towards the estate. HMRC says death in service benefits and dependants' scheme pensions from a defined benefit arrangement are excluded. Exactly which police death benefits are in scope depends on the scheme: ask your pension administrator.
Does the salary sacrifice National Insurance cap affect police pensions?
It only applies to pension contributions made through salary sacrifice (an 'optional remuneration arrangement'). From the 2029-30 tax year, NI will be due on sacrificed pension contributions above £2,000 a year (NIC (Employer Pensions Contributions) Act 2026). If your police pension contribution is shown on your payslip as an ordinary deduction, this measure is not about it. Check with payroll if you use any salary sacrifice scheme.
Should I commute, retire or opt out before the Budget?
We cannot tell you what to do, and no pension change has been announced. GAD's 21 May 2026 letter says it does not announce factor reviews in advance. Ask your administrator for quotes at different dates, ask your Federation or association, and for a large or irreversible decision speak to a regulated financial adviser.
When will the April 2027 police pension increase be known?
The ONS publishes September 2026 CPI on 21 October 2026, a week before the Budget. Public service pensions are increased each April by a Treasury order under the Social Security Pensions Act 1975 s.59, following that figure; the April 2026 increase was 3.8% for pensions that began before 7 April 2025 (Pensions Increase (Review) Order 2026). The Budget does not set it.
Does the UK Budget change tax for Police Scotland officers?
Partly. National Insurance and the Personal Allowance are UK-wide, so UK Budget changes to them would apply in Scotland. Scottish income tax rates and bands (19% to 48% in 2026/27) are set by the Scottish Parliament in its own budget. Police Scotland pay and the Scottish police pension scheme are separate systems.
Sources and how we checked them
Every figure on this page was read from the sources below on 1 October 2026, primary sources first. Rules change, and this page will be rewritten after 28 October 2026. Spotted something out of date? See our corrections policy.
- HM Treasury press release: Budget date confirmed (31 July 2026) — Budget on Wednesday 28 October; Budget representation portal closed 9 September.
- Chancellor's letter to the Treasury Committee on Budget timing (31 July 2026, PDF) — OBR asked to prepare an economic and fiscal forecast for publication on 28 October 2026, accompanied by the Budget.
- Finance Act 2026, sections 2, 4 to 8, 10 and 66 to 71 (legislation.gov.uk) — 2026-27 main rates; dividend, savings and property rates; thresholds frozen to 2030-31; inheritance tax on pensions from 6 April 2027.
- HMRC policy paper: maintaining Income Tax and NI thresholds until 5 April 2031 (26 November 2025) — Personal Allowance £12,570 and basic rate limit £37,700 to 2030-31; NI primary threshold and upper earnings limit kept aligned.
- GOV.UK: Income Tax rates and Personal Allowances — 2026/27 bands, rates and the £100,000 Personal Allowance taper.
- HMRC: Rates and thresholds for employers 2026 to 2027 — NI primary threshold £12,570 (£1,048 a month), upper earnings limit £50,270 (£4,189 a month), employee rates 8% and 2%.
- GOV.UK: Tax on your private pension contributions (annual allowance and lump sum allowance) — Annual allowance £60,000; carry forward; lump sum allowance £268,275; lump sum and death benefit allowance £1,073,100; uniformed services not reduced.
- HMRC: Work out your tapered annual allowance — Threshold income £200,000, adjusted income £260,000, minimum tapered allowance £10,000.
- HMRC policy paper: Inheritance Tax on unused pension funds and death benefits (26 November 2025) — Scope from 6 April 2027; death in service benefits and dependants' scheme pensions from defined benefit arrangements excluded.
- National Insurance Contributions (Employer Pensions Contributions) Act 2026, section 1 — NI on salary-sacrificed pension contributions above a £2,000 limit, from the 2029-30 tax year.
- Written statement HCWS37: Public Service Pensions: SCAPE discount rate (HM Treasury, 19 May 2026) — New SCAPE discount rate CPI + 2%; 2024 valuations to set employer contribution rates from April 2027.
- GAD letter to the Home Office: 1987 Scheme commutation factor tables (21 May 2026, copy published by the Police Federation) — New factors in force immediately; GAD does not announce reviews in advance. Factor values used via our GAD data file.
- GAD news: Public service pension schemes, new CETV factors (16 June 2026) — SCAPE change announced 19 May 2026; transfer value calculations suspended then resumed.
- Written statement HCWS264: Police workforce (Home Secretary, 15 July 2026) — 3.5% for all ranks from 1 September 2026; extra funding £84m, £144m and £145m over three years.
- Written statement HCWS1285: Final police funding settlement 2026-27 (28 January 2026) — Police grant report under Police Act 1996 s.46(2); up to £21.0bn for the policing system in 2026-27.
- Police Act 1996, sections 50 and 64B (legislation.gov.uk) — Regulations on pay and conditions; the PRRB reports to the Home Secretary and the Prime Minister.
- Public Service Pensions Act 2013, sections 22 and 23 (legislation.gov.uk) — Protected elements to 31 March 2040; consent needed for retrospective changes with significant adverse effects.
- Police Pensions (Amendment) Regulations 2026 (SI 2026/267) — 2015 scheme member contribution rates from 1 April 2026.
- Pensions Increase (Review) Order 2026 (SI 2026/256) — 3.8% from 6 April 2026; made under Social Security Pensions Act 1975 s.59.
- ONS release calendar: Consumer price inflation, UK: September 2026 — Scheduled for 21 October 2026, 7am.
On this topic elsewhere
Disclaimer
PolicePay is independent and not affiliated with HM Treasury, the Home Office, HMRC, the OBR, the PRRB, any staff association or any force. This page explains published rules and dates; it is not financial or tax advice and makes no prediction about the Budget. Details are as checked on 1 October 2026.