Find out exactly how much income tax and National Insurance you pay on your salary and what your monthly take-home pay is. Based on 2026/27 UK tax rates and thresholds. Includes student loan plan deductions.
2026/27 — England
Estimate only, not tax or financial advice. This uses 2026/27 income tax and Class 1 National Insurance for England. Wales and Northern Ireland use the same bands on earned income; Scotland does not. Pension contributions, Gift Aid and Marriage Allowance are ignored, so the personal allowance is tapered on the salary you enter. Above £100,000 the allowance falls by £1 for every £2, and it is zero from £125,140. Student loan figures use the 2026/27 annual thresholds. Rates may change — check HMRC.
Income tax on earned income in England is charged above the Personal Allowance of £12,570. You pay each rate only on the slice of taxable income inside that band. The £50,270 figure below assumes the full allowance is still available. The basic-rate band itself is £37,700 of taxable income, so when the allowance is reduced, 40% tax starts on a lower salary.
Employees pay Class 1 National Insurance at 8% on earnings between £12,570 and £50,270, and 2% on earnings above £50,270. NI contributions fund the NHS, state pension and other benefits.
If your adjusted net income is above £100,000, the Personal Allowance falls by £1 for every £2 over that limit, and it is zero at £125,140. At £100,000 the allowance is still £12,570 and income tax is £27,432. At £110,000 the allowance is £7,570 and income tax is £33,432, which is £2,000 more than if the full allowance had applied. The extra £2,000 is 40% of the £5,000 of allowance you lose, so the marginal rate on earned income through this band is 60% before National Insurance. This calculator tapers the allowance on the salary you type. It does not deduct pension contributions or Gift Aid, which can reduce adjusted net income and preserve allowance.
Student loan repayments are deducted from your salary through PAYE alongside tax and National Insurance. The amount you repay depends on which plan you're on and how much you earn above the repayment threshold. For 2026/27 the annual thresholds are Plan 1 £26,900, Plan 2 £29,385, Plan 4 (Scotland) £33,795 and Plan 5 £25,000. Each plan repays 9% of income above its threshold. A postgraduate loan, where you have one, is a separate 6% above £21,000 and is not included here.
Your tax code appears on your payslip and determines how much tax-free pay you receive each month. The most common tax code for 2026/27 is 1257L, which gives you the full Personal Allowance of £12,570. Your tax code is sent to your employer by HMRC and is based on your circumstances. If your code ends in L you have the standard Personal Allowance. If it ends in M or N you've transferred some allowance to or from your spouse. An emergency tax code (usually 1257L W1 or M1) means you're temporarily paying tax without the benefit of your full allowance, which you can reclaim later. Check your tax code is correct as errors can mean you pay too much or too little tax.
If you have multiple jobs or pensions, you only get one Personal Allowance which is normally used against your main source of income. Your second job will have a different tax code (often BR for Basic Rate) meaning you pay 20% tax on all earnings from that job with no tax-free allowance. This can seem harsh but it ensures you don't get more than one Personal Allowance. At the end of the tax year HMRC will calculate your total tax bill and refund any overpayment. You can also contact HMRC to split your Personal Allowance between jobs if you prefer, though most people find it simpler to use it all against their main employment.
Yes, there are several legitimate ways to reduce your tax bill. Contributing to a workplace pension reduces your taxable income as pension contributions are made before tax is calculated — a £100 pension contribution only costs you £80 if you're a basic rate taxpayer, or £60 if you're a higher rate taxpayer. Using your full ISA allowance (£20,000 per year) means investment growth and interest are completely tax-free. Claiming all eligible expenses if you're self-employed or have employment expenses reduces your taxable profit. Marriage Allowance lets you transfer £1,260 of your Personal Allowance to your spouse if you earn under £12,570 and they're a basic rate taxpayer, saving up to £252 per year. Salary sacrifice arrangements for benefits like childcare vouchers or cycle to work schemes also reduce your taxable salary. Always check you're claiming any tax reliefs you're entitled to such as working from home allowances or professional subscriptions.
Most employees have tax deducted through PAYE and don't need to file a tax return. However, you must complete Self Assessment if you're self-employed, a company director, have income from property or investments over £10,000, earn over £100,000, or receive income from abroad. The deadline for online submission is 31st January following the end of the tax year (so 31st January 2027 for the 2025/26 tax year). You must also pay any tax owed by this date to avoid penalties. If you miss the deadline you'll be charged an automatic £100 penalty even if you don't owe any tax. Register for Self Assessment as soon as you think you might need to complete a return — you can register online through the HMRC website and will receive a Unique Taxpayer Reference within 10 working days.
Your gross salary is your total earnings before any deductions like tax, National Insurance or pension contributions. This is the figure usually quoted in job adverts and employment contracts. Your net salary (or take-home pay) is what actually lands in your bank account after all deductions. The difference between gross and net can be substantial — someone earning £40,000 gross takes home about £32,320 after income tax and National Insurance, roughly 19% in those two deductions. On £60,000 the take-home is about £45,357, roughly 24%. A pension contribution or student loan reduces that further. A £5,000 gross rise is worth £4,000 after basic-rate tax, or £3,000 after higher-rate tax, before National Insurance.
On a salary of £30,000 you pay no tax on the first £12,570 (Personal Allowance). The remaining £17,430 is taxed at the basic rate of 20%, giving income tax of £3,486 per year. For National Insurance you pay 8% on earnings between £12,570 and £30,000, which equals £1,394. Your total deductions are £4,880 per year, leaving take-home pay of £25,120 annually or £2,093 per month. This is an effective tax rate of 16.3% on your total salary.
With a £60,000 salary you use your full Personal Allowance of £12,570 tax-free. You then pay 20% tax on the next £37,700 (up to £50,270) which is £7,540. The remaining £9,730 is taxed at the higher rate of 40%, adding £3,892 in tax. Total income tax is £11,432. For National Insurance you pay 8% on the first £37,700 above the threshold (£3,016) plus 2% on the remaining £9,730 (£195), totaling £3,211. After tax and NI of £14,643 your take-home pay is £45,357 per year or £3,780 per month. Your effective tax rate is 24.4%.
At £150,000 the Personal Allowance is zero, so taxable income is the full £150,000. Income tax is 20% on the first £37,700 (£7,540), 40% on the next £87,440 up to £125,140 (£34,976) and 45% on the remaining £24,860 (£11,187). Total income tax is £53,703. National Insurance is 8% on £37,700 (£3,016) plus 2% on £99,730 (£1,994.60), totalling £5,010.60. Take-home pay before any pension or student loan is £91,286.40 a year, about £7,607 a month. The calculator rounds the annual tax and National Insurance it displays to the nearest pound.
Income is £10,000 over £100,000, so the allowance falls by £5,000, from £12,570 to £7,570. Taxable income is £102,430. Income tax is 20% of £37,700 (£7,540) plus 40% of £64,730 (£25,892), which is £33,432. National Insurance is not affected by the taper: £3,016 plus 2% of £59,730 (£1,194.60), so £4,210.60. Take-home pay before a pension or student loan is £72,357.40.
Make full use of your £20,000 ISA allowance each tax year as this allows investments and savings to grow completely tax-free with no capital gains tax or income tax on returns. If you're approaching the higher rate threshold of £50,270, increasing pension contributions can keep you in the basic rate band while building retirement savings. Pension contributions reduce your taxable income pound-for-pound, so a £5,000 contribution could save you £2,000 in tax if you're a higher rate payer. Consider timing bonuses or income carefully — if you're close to a tax threshold it may be worth deferring income to the next tax year to avoid paying a higher rate. Married couples should use Marriage Allowance if one partner earns under £12,570 to transfer unused Personal Allowance. Keep accurate records of any work expenses you're entitled to claim such as professional subscriptions, working from home costs, or mileage if you use your own vehicle for work. Check your tax code annually to ensure it's correct as errors are common and can result in overpaying tax for months before it's noticed. If you're self-employed, consider whether incorporating as a limited company might be tax-efficient once your income reaches certain levels, though this comes with additional compliance requirements and should be discussed with an accountant.