Take-Home Pay Calculator 2026/27

How the take-home pay calculator works

Your take-home pay is your gross salary minus the deductions your employer makes through PAYE. For most people those are Income Tax, National Insurance, student loan repayments and pension contributions. The calculator applies the official 2026/27 rates in the same order payroll does, and the How this was calculated panel under the result shows every step.

1. Gross pay. Your salary, plus any bonus and overtime. If you’re paid hourly or weekly, we convert it to an annual figure using your hours and days per week.
2. Salary sacrifice comes off first. Pension salary sacrifice and schemes like cycle-to-work reduce the pay that is taxed and that NI is charged on.
3. Tax-free allowance. Most people get the £12,570 Personal Allowance. Above £100,000 it shrinks by £1 for every £2 earned. If you enter a tax code, we use the allowance in the code instead.
4. Income Tax is charged on the rest at 20%, 40% and 45% in England, Wales and Northern Ireland, or across Scotland’s six bands from 19% to 48%.
5. National Insurance is worked out for each pay period: 8% on earnings between £1,048 and £4,189 a month, then 2% above that.
6. Student loans repay 9% (6% for postgraduate loans) of pay above your plan’s threshold, rounded down to the pound each payday.
7. Relief-at-source pensions come out of your net pay at 80% of the gross contribution, because your provider claims the 20% basic-rate relief for you.

A worked example: £40,000 in 2026/27

Someone on £40,000 in England with no pension or student loan pays £5,486.00 Income Tax and £2,193.96 National Insurance. Their take-home pay is £32,320.04 a year, or about £2,693 a month.

£40,000 salary	Per year	Per month
Gross pay	£40,000.00	£3,333.33
Income Tax	£5,486.00	£457.17
National Insurance	£2,193.96	£182.83
Take-home pay	£32,320.04	£2,693.34

Add a Plan 2 student loan and a 5% relief-at-source pension, and take-home falls to £29,772.04 a year (£2,481 a month). The student loan costs £948 a year and the pension £1,600 — though £2,000 actually goes into the pension pot, because of tax relief.

The same £40,000 in Scotland leaves £32,254.97 a year. The intermediate 21% band costs a little more here, but Scotland’s 19% starter rate claws some of it back.

Your effective and marginal tax rates

The calculator shows two rates, and they answer different questions.

• Effective rate is total Income Tax, NI and student loan divided by gross pay. It tells you how much of your salary you hand over overall.
• Marginal rate is how much of your next pound of pay goes in deductions. It’s the number that matters when you’re weighing up a pay rise, overtime or a bigger pension contribution.

For a basic-rate taxpayer in England the marginal rate is usually 28% (20% tax plus 8% NI). Add a student loan and it becomes 37%. Between £100,000 and £125,140 it jumps to 62% as the Personal Allowance is withdrawn. That’s the “£100k tax trap”, and the calculator flags it automatically.

Cliff edges the calculator warns you about

Some thresholds cost far more than the headline tax rate suggests. When your adjusted net income (pay after pension contributions) lands in one of these zones, the result panel shows a warning and the pension contribution that would get you out of it.

• £60,000–£80,000: High Income Child Benefit Charge. If you or your partner claim Child Benefit, 1% of it is clawed back for every £200 over £60,000.
• £100,000: childcare support. Earn £1 over £100,000 and you lose Tax-Free Childcare and the extended free childcare hours. For a family with young children that can be worth thousands of pounds.
• £100,000–£125,140: the 60% band. You lose £1 of Personal Allowance for every £2 you earn, so each extra £1 costs 60p in tax, plus NI.

Pensions: relief at source, net pay and salary sacrifice

Pension schemes collect contributions in three different ways, and each one changes your payslip differently.

• Relief at source. You pay 80% from take-home pay and the provider adds the other 20%. Higher-rate taxpayers claim the extra relief, which we model by extending your basic-rate band.
• Net pay arrangement. The contribution comes off before Income Tax but after NI.
• Salary sacrifice. Your contractual salary drops, so you save both tax and NI. From April 2029 only the first £2,000 a year will stay free of NI.

Pick Qualifying earnings if your employer only uses auto-enrolment minimums. Contributions are then based on pay between £6,240 and £50,270.

When to use a tax code

If you know your tax code, from your payslip or your HMRC app, enter it under Tax code & other options. We support standard codes such as 1257L, Scottish (S) and Welsh (C) prefixes, K codes, BR, D0, D1, NT and emergency codes ending in M1, W1 or X. A K code means untaxed benefits or underpaid tax are being collected, so your taxable pay goes up rather than down.

What this calculator does not cover

The results describe a normal tax year with one job. They don’t include income from a second job (use the two jobs mode in the pay rise calculator), savings or dividend tax, Child Benefit itself, or tax refunds from overpaid emergency tax. If you’re self-employed, use the self-employed tax calculator instead.