Every person who is resident in the UK is given a personal allowance each tax year. It operates as follows:
The personal allowance is the amount of income you can receive before paying tax – and it generally increases each tax year. For the 2024/25 tax year, it is (still) £12,570. So, if you earn £20,000 in 2024/25, you will be subject to income tax on £7,430 of your earnings.
The personal allowance is reduced when your income exceeds £100,000 in a tax year (by £1 for every £2 your income exceeds £100,000) – so that if your taxable income reaches £125,140 (in 2024/25), you will no longer receive a personal allowance.