Inflation Calculator UK

CPIH is the Consumer Prices Index including owner-occupiers' housing costs, published by the ONS as series D7BT. It is the ONS's preferred headline measure of UK inflation because, unlike CPI, it includes housing costs, which are the largest single expense for most households. RPI is no longer a National Statistic and tends to overstate inflation. This calculator uses annual averages of CPIH (2015 = 100) from 1989 to 2024.

Fiscal drag is the stealth tax rise that happens when tax thresholds stay the same in cash terms while wages rise with inflation. Because the £12,570 Personal Allowance, the £50,270 higher-rate threshold, the £100,000 taper point and the £60,000 HICBC threshold are frozen until April 2031, every year of pay rises pulls more of your income into higher tax bands — or into the band where your Personal Allowance is being withdrawn — even if your real-terms pay is flat.

Yes. The freeze originated in Rishi Sunak's March 2021 Budget, was extended by Jeremy Hunt in November 2022 to April 2028, and was extended a further three years by Rachel Reeves in the Autumn Budget 2025 to April 2031. The £12,570 Personal Allowance and £50,270 higher-rate threshold are frozen to tax year 2030-31. The £100,000 Personal Allowance taper threshold is also frozen, as is the £60,000 High Income Child Benefit Charge threshold (raised from £50,000 in April 2024, and it tapers up to £80,000).

The £12,570 Personal Allowance was set in April 2021. Between April 2021 and late 2024, UK CPIH rose roughly 20%. If the allowance had been uprated in line with CPIH, it would already be worth around £15,000 — meaning the freeze has added roughly £450 to a basic-rate taxpayer's annual tax bill, and more for higher earners affected by the £50,270 threshold.

No. The Fiscal Drag tab models income tax only. NI thresholds (£12,570 Primary Threshold, £50,270 Upper Earnings Limit) are similarly frozen until 2031, so the total fiscal drag on employment income — including student loan repayment thresholds, which are set separately — is larger than the income-tax figure alone. Use the National Insurance calculator and Take-Home Pay calculator alongside this one to see the full picture.

The Bank of England's CPI target is 2%, which is a reasonable long-run assumption. CPIH has run higher since 2022 — averaging over 4% through the 2022–24 period — and at the time of writing is still above 2%. For a conservative projection of the remaining freeze window (through tax year 2030-31), try 2.5%–3.5%.

Yes. When enabled, the Fiscal Drag tab uses the Scottish income-tax bands (Starter, Basic, Intermediate, Higher, Advanced, Top rates from 19% to 48%), held constant over the freeze window. The Personal Allowance is UK-wide and reserved to Westminster, so the freeze applies to Scottish taxpayers identically, and Scottish bands are set by the Scottish Government and have been largely frozen year-on-year in cash terms too.

The calculator uses published ONS annual averages of CPIH (series D7BT, 2015 = 100) from 1989 to 2024, rounded to one decimal place. For precise single-month comparisons, use the ONS Inflation Calculator on the ONS website.

Because inflation compounds. A 2% pay rise when inflation is 4% means your real buying power fell by roughly 2% that year. Over five years the gap compounds to about 10%. The Salary Erosion tab shows exactly how nominal and real pay diverge year by year.