UK Income Tax / PAYE Calculator
Calculate your take-home pay after Income Tax, National Insurance, and Pension contributions. Updated for 2025/2026.
Workplace auto-enrolment is typically 5%
Ready to Calculate
Enter your income and details on the left to see a detailed breakdown of your tax liability and take-home pay.
Frequently Asked Questions
How to use this calculator
1. Select how you want to input your salary (weekly, monthly, or yearly).
2. Enter your gross salary before any deductions.
3. Enter your workplace pension contribution percentage (default is usually 5% for employees under auto-enrolment).
4. The calculator will instantly show your yearly breakdown, including your net take-home pay.
Understanding your results
Gross Salary: Your total earnings before any taxes or deductions.
Pension: The amount deducted for your workplace pension. This reduces your taxable income for Income Tax purposes.
Income Tax: Calculated using the 2025/2026 UK tax bands (20% basic rate, 40% higher rate, 45% additional rate) after your £12,570 Personal Allowance.
National Insurance: Calculated based on Class 1 NI rates for employees (8% on earnings between £12,570 and £50,270, and 2% above that).
Net Take-Home: The final amount that lands in your bank account.
A Comprehensive Guide to UK Income Tax and PAYE
Understanding your payslip and how your take-home pay is calculated is essential for managing your personal finances in the UK. For the vast majority of employees, taxes are collected automatically through the Pay As You Earn (PAYE) system. This guide explains exactly how your gross salary is transformed into your net take-home pay.
What is PAYE?
PAYE stands for Pay As You Earn. It is the system HMRC uses to collect Income Tax and National Insurance Contributions (NICs) directly from your wages before they are paid to you. Your employer is responsible for making these deductions based on your tax code and sending the money to HMRC.
The Personal Allowance
Before you pay any Income Tax, you are entitled to a tax-free amount known as the Personal Allowance. For the 2025/2026 tax year, the standard Personal Allowance is £12,570. This means you can earn up to this amount without paying any Income Tax.
However, if your adjusted net income exceeds £100,000, your Personal Allowance decreases by £1 for every £2 earned above the threshold. If you earn £125,140 or more, your Personal Allowance is reduced to zero.
UK Income Tax Bands (2025/2026)
Once your income exceeds your Personal Allowance, it is taxed at progressive rates. The UK tax system is 'marginal', meaning you only pay the higher rate on the portion of your income that falls into that specific band.
- Basic Rate (20%): Paid on income between £12,571 and £50,270.
- Higher Rate (40%): Paid on income between £50,271 and £125,140.
- Additional Rate (45%): Paid on all income over £125,140.
Note: If you live in Scotland, different tax bands and rates apply, as these are set by the Scottish Government.
National Insurance Contributions (NICs)
In addition to Income Tax, employees must pay Class 1 National Insurance Contributions. These contributions help build your entitlement to certain state benefits, most notably the State Pension.
For the 2025/2026 tax year, the rates for employees are:
- 8% on earnings between the Primary Threshold (£12,570) and the Upper Earnings Limit (£50,270).
- 2% on all earnings above the Upper Earnings Limit (£50,270).
Workplace Pensions
Under auto-enrolment rules, most employers must provide a workplace pension scheme. The standard minimum contribution is 8% of your qualifying earnings, with at least 3% coming from your employer and up to 5% from you.
Pension contributions are highly tax-efficient. In most schemes, your contribution is deducted from your gross salary before Income Tax is calculated. This provides immediate tax relief at your highest marginal rate, effectively lowering your overall tax bill while saving for your future.