Salary Calculator UK

How to Use This Calculator

• Enter your gross annual salary
• Select your tax region, England, Wales, Northern Ireland or Scotland
• Enter your pension contribution percentage (if applicable)
• Select your student loan plan (if applicable)
• Click Calculate

Your result shows your annual, monthly, weekly, and hourly take-home pay, with a full breakdown of income tax, National Insurance and any other deductions applied.

UK Income Tax Bands 2026/27

Income tax and NI thresholds are frozen for 2026/27, so the figures are identical to 2025/26. The personal allowance stays at £12,570, basic rate 20% applies up to £50,270, higher rate 40% applies to £125,140, and the additional rate of 45% applies above that. Employee NI is 8% then 2%.

Income tax in England, Wales and Northern Ireland works in slices, you do not pay a flat rate on your whole salary. Each portion of your income is taxed at the rate for that band only.

Source: HMRC Income Tax rates and allowances, confirmed for 2026/27.

Example: On a £45,000 salary, you pay 0% on the first £12,570,and 20% on the remaining £32,430, giving an income tax bill of £6,486. You do not enter the 40% higher rate band until your earnings exceed £50,270.

National Insurance Rates 2026/27

National Insurance (Class 1) funds the State Pension, NHS, and other contributory benefits. Employees pay NI on earnings above the Primary Threshold.

For 2026/27, you pay 8% NI on earnings between £12,570 and £50,270, then 2% on anything above £50,270. Self-employed people pay different rates, 6% and 2%.

Unlike income tax, NI does not taper or disappear, it simply drops to 2% above the upper earnings limit. This means every pound above £50,270 attracts both 40% income tax and 2% NI, a combined marginal rate of 42%.

Take-Home Pay Examples

Here are worked examples based on 2026/27 HMRC rates, assuming a standard 1257L tax code, no student loan and no pension deductions:

Below are example salary calculations using official HMRC 2026/27 tax rates and thresholds. Because income tax and NI are frozen, these 2026/27 figures are identical to 2025/26.

These are estimates. Your actual take-home depends on your tax code, pension contributions, student loan plan and any taxable benefits.

Scottish Income Tax

Scotland sets its own income tax rates and bands through Holyrood. While National Insurance rates are the same as the rest of the UK, income tax in Scotland has more bands and different rates.

Scotland has six income tax bands for 2026/27: Starter Rate at 19%, Basic Rate at 20%, Intermediate Rate at 21%, Higher Rate at 42%, Advanced Rate at 45% and Top Rate at 48%. Use the Region selector in the calculator to switch between Scottish and rest-of-UK rates.

Source: Scottish Government, confirmed for 2026/27.

For taxpayers earning between approximately £43,000 and £50,270, Scottish higher rate tax of 42% applies, compared to 20% basic rate for the same income in England. This can produce a meaningful difference in take-home pay for the same gross salary depending on where you live.

Student Loan Deductions

Student loan repayments come off your pay through PAYE and are calculated as a percentage of earnings above your plan threshold.

Student loan repayments are 9% of earnings above your plan threshold (6% for Postgraduate loans). For 2026/27: Plan 1 threshold is £26,900, Plan 2 is £29,385, Plan 4 is £33,795, Plan 5 is £25,000, and Postgraduate is £21,000.

Student loan repayments do not reduce your taxable income, they come off after tax and NI are calculated. This means they reduce your take-home pay but do not lower your tax bill.

Pension Contributions and Salary Sacrifice

Pension contributions affect your take-home pay, but the impact depends on how your pension scheme works.

Salary sacrifice is the most tax-efficient method. Your pension contribution is deducted from your gross pay before income tax and NI are calculated. This means you save both income tax and National Insurance on the amount contributed, not just income tax.

Net pay arrangements deduct contributions before income tax but after NI. You save income tax but not NI.

Relief at source takes contributions from your net pay and the pension provider claims 20% basic rate tax relief back from HMRC directly.

Salary sacrifice pension contributions reduce your gross pay before tax and NI are calculated, giving you tax relief on both, making it the most tax-efficient option for most employees.

Example: If you earn £50,000 and contribute 5% (£2,500) via salary sacrifice, your taxable income drops to £47,500. You save 20% income tax (£500) and 8% NI (£200), a total saving of £700 per year on a £2,500 contribution.

The £100,000 Trap : The 60% Effective Tax Rate

This is one of the most important and misunderstood aspects of UK taxation and it affects anyone whose income approaches or exceeds £100,000.

Once your salary crosses £100,000, your personal allowance starts to taper. You lose £1 of allowance for every £2 earned above £100,000, so by the time you reach £125,140 the allowance is gone completely.

The result is a hidden effective tax rate of 60% on income between £100,000 and £125,140, sometimes called the £100k trap. For every £2 earned in this range, you lose £1 of personal allowance and pay 40% tax on the income that was previously covered by the allowance, plus 40% on the new earnings themselves.

The practical solution for many people in this range is salary sacrifice pension contributions. Increasing pension contributions to bring your adjusted net income below £100,000 can restore your full personal allowance and dramatically reduce your effective tax rate.

If your income is approaching or in this band, speaking to an accountant or independent financial adviser is genuinely worthwhile.

Effective Tax Rate vs Marginal Rate

Two terms that cause a lot of confusion and both matter for understanding your pay.

Marginal rate is the tax rate on your next pound of income. If you earn £55,000, your marginal income tax rate is 40% because any additional earnings fall in the higher rate band.

Effective rate is the average rate across your total income, total tax paid divided by total gross income.

Your marginal rate is the tax on the next pound you earn, while your effective rate is total tax divided by total income. These differ because some income is taxed at lower bands or covered by allowances.

Understanding the difference matters for decisions like pay rises, bonuses or side income, where many people incorrectly assume they will lose the majority of additional earnings to tax.

Understanding Your Tax Code

Your tax code tells your employer how much tax-free income you are entitled to. Most UK employees on standard PAYE have the code 1257L, which corresponds to the standard £12,570 personal allowance.

Common tax code suffixes:

• L: standard personal allowance
• M: you receive Marriage Allowance from your spouse
• N: you have transferred Marriage Allowance to your spouse
• T: HMRC needs to review your tax code
• K: you have untaxed income greater than your personal allowance (e.g. some benefits in kind)

If your tax code is anything other than 1257L and you are not sure why, check your HMRC Personal Tax Account at gov.uk or contact HMRC directly. An incorrect tax code can mean you overpay or underpay tax throughout the year.

Average UK Salary Context

Understanding where your salary sits relative to UK averages can be useful context for job offers, pay reviews and financial planning.

Based on official HMRC and ONS data for 2025/26: the median UK full-time annual salary was approximately £37,430. At this income, an employee pays 0% on the first £12,570, 20% on the remaining £24,860 and takes home approximately £30,118 per year or £2,510 per month.

Regional salary averages vary significantly. London typically shows median full-time salaries above £45,000, while many regions in Wales, the East Midlands, and the North East sit closer to £30,000 to £33,000. The calculator's results are national, regional living costs vary considerably even for the same take-home figure.

Related Calculators