See what you actually take home

Income Tax is the main tax on employment income in the United Kingdom. It's collected through the Pay As You Earn (PAYE) system. Your employer deducts it from your salary each pay period before you receive your wages.

Everyone gets a tax-free Personal Allowance of £12,570 for the 2025/26 tax year. You only pay Income Tax on earnings above this threshold. The allowance is reduced by £1 for every £2 earned over £100,000, reaching zero at £125,140.

England, Wales & Northern Ireland Tax Bands (2025/26)

Source: GOV.UK: Income Tax rates

Scotland sets its own Income Tax rates and bands, which differ from the rest of the UK. Scottish taxpayers have a tax code beginning with 'S' (e.g. S1257L). National Insurance rates are the same across the whole UK.

Scottish Tax Bands (2025/26)

Source: GOV.UK: Scottish Income Tax

National Insurance contributions (NICs) fund the State Pension, NHS, and other benefits. Employees pay Class 1 NICs through PAYE. You stop paying employee NI when you reach State Pension age.

Employee NI Rates (2025/26)

Employer NI Rates (2025/26)

Employers pay 15% NI on earnings above the secondary threshold of £5,000 per year. There is no upper limit. You can view the employer NI cost using the "Show employer cost" toggle on the payslip.

Source: GOV.UK: National Insurance rates

If you have a student loan, repayments are deducted from your salary through PAYE once you earn above your plan's repayment threshold. The amount repaid is a percentage of income above the threshold, not the total income.

Repayment Thresholds (2025/26)

Source: GOV.UK: Student loan repayments

Workplace pension contributions reduce your tax bill, but the amount of relief depends on the scheme type. Under auto-enrolment, the minimum total contribution is 8% of qualifying earnings (5% employee, 3% employer).

Pension Scheme Types

Source: GOV.UK: Pension tax relief

One of the most misunderstood features of the UK tax system is the Personal Allowance taper. For every £2 you earn over £100,000, you lose £1 of your £12,570 Personal Allowance. This means the effective marginal tax rate in the £100,000 – £125,140 range is approximately 60% (40% Income Tax + 20% from losing the allowance).

For example, a £1,000 pay rise at £110,000 gross would cost you around £600 in additional tax and lost allowance, so you'd keep only ~£400. Our "Next +£1,000 raise" insight automatically highlights when you're in this zone.

One common strategy to mitigate this is increasing pension contributions via salary sacrifice, which reduces your taxable income below the £100,000 threshold and restores your full Personal Allowance.

Your tax code tells your employer how much tax-free income you're entitled to. The most common code is 1257L, which gives the standard Personal Allowance of £12,570. You can find your tax code on your payslip, P45, P60, or your HMRC online account.

Common Tax Codes

You can enter your tax code in the calculator's advanced settings to see a personalised breakdown. GOV.UK: Tax codes

If you're married or in a civil partnership and one partner earns less than the Personal Allowance (£12,570), they can transfer up to £1,260 of their allowance to the higher earner. The receiving partner must be a basic rate taxpayer (not higher or additional rate).

This saves the couple up to £252 per year (£1,260 × 20%). The transferring partner gets tax code 1194N and the receiving partner gets 1382M, reflecting the adjusted allowances.

Source: GOV.UK: Marriage Allowance