How much of a £5,000 pay rise do I actually keep?

It depends where the rise lands in the bands. Entirely within the basic-rate band you keep 72% (£3,600) after 20% tax and 8% NI. If it crosses £50,270 the portion above is kept at 58%; add a Plan 2 student loan and that drops to 49%. Enter both salaries to see your exact keep-rate.

Should I compare salaries before or after pension contributions?

Set each salary's own pension arrangement in the calculator — different employers often have very different schemes, and a 3% employer contribution against 8% can be worth more than a few thousand pounds of headline salary. The comparison shows take-home; weigh the employer pension separately as deferred pay.

Why is my percentage pay rise bigger than my take-home rise?

Progressive tax means each extra pound is taxed at your highest rate, so a 10% gross rise typically becomes a 7–8% net rise for a basic-rate payer and less if you cross into higher rate. The difference column in this calculator shows the exact monthly cash change, which is the honest number for budgeting.

Can I compare a Scottish salary against an English one?

The Scottish toggle applies to you as a taxpayer, not to the job — your residence determines which bands you pay, wherever the employer is. If you are moving between Scotland and the rest of the UK, run the comparison twice, once with the toggle on and once off, to see both regimes.

What about benefits like a car allowance or private medical?

Cash allowances are simply salary — add them to the gross figure. Benefits in kind (company car, medical insurance) raise your tax without raising cash pay; as a quick approximation add the P11D value to the gross of that job and subtract the notional amount from its take-home.

Is a higher salary always worth more than better benefits?

Not necessarily. After crossing £50,270, marginal deductions of 42–51% shrink each headline pound, while an extra 5% employer pension arrives untaxed into your pot. Comparing net take-home with this tool is step one; valuing pension, holiday and flexibility differences is the judgement call on top.

Salary Comparison Calculator UK — Two Salaries Compared

Comparing salaries the honest way

Both salaries are run through the identical 2026/27 PAYE calculation — same tax code, same student loan plans, but each with its own pension arrangement, because schemes differ between employers and that difference is often worth thousands. The difference column is simply B minus A on every line, so you can see not just the take-home change but where it comes from: how much of the rise the higher tax band absorbs, what the student loan takes, what your pension keeps.

Worked example: £35,000 → £40,000 with Plan 2

The £5,000 rise sits entirely in the basic-rate band: tax up £1,000, NI up £400, Plan 2 repayments up £450. Net gain: £3,150 a year — £262.50 a month, a 63% keep-rate. The same £5,000 rise from £48,000 to £53,000 keeps only about £2,600 because £2,730 of it is taxed at 40%. That asymmetry is why comparing at your actual salary matters more than any rule of thumb.

If the new role changes your hours too, the pro-rata calculator normalises them first; if it's a second job rather than a replacement, use the two jobs calculator — the tax mechanics are different.

Income & Tax

Comparing two job offers in the UK: what a pay rise is really worth

By CalculatorDashboard Editorial Team·Updated 3 October 2026·Reviewed 3 October 2026·5 min read

A job offer arrives with one number on it, and that number is the least useful thing about it. The salary tells you what the employer will spend on your pay. It doesn't tell you what will reach your bank account, what will reach your pension, or what the new job will cost you to do. Comparing two offers properly means turning both packages into the same currency: money you keep, now and later.

The calculator above handles the first part, take-home pay under identical 2026/27 rules. This guide covers the rest of the comparison, and the places where a bigger salary can turn out to be worth less than it looks.

A worked example: £42,000 now, £46,000 on offer

Sam earns £42,000 and repays a Plan 2 student loan. Their current employer runs a net-pay pension: Sam pays 5% and the employer adds 3%. A rival firm offers £46,000, a £4,000 rise. The new employer uses salary sacrifice for the pension, with the same 5% from Sam and a more generous 6% employer contribution.

Put both into the calculator and the take-home gain is £2,751 a year, or about £229 a month. That is less than the £4,000 headline because the rise is taxed at 20%, attracts National Insurance at 8% and lifts Sam's student loan repayments. But the pension tells a different story. Sam's own contribution rises by £200, and the employer's contribution rises from £1,260 to £2,760, an extra £1,500 a year that never passes through payroll tax. Taken together, the offer adds roughly £4,450 a year of value on a £4,000 rise. Salary sacrifice explains the difference: Sam's pension comes out before National Insurance and student loan, so the same 5% costs less take-home than it did under the old scheme.

Now add the part no payslip shows. Suppose the new office needs four days a week on site instead of two, and the extra train fares come to about £95 a month. That is £1,140 a year from taxed income, which cuts Sam's real cash gain to about £1,610, or £134 a month. The move is still worth making, especially for the pension, but it is a very different decision from "£4,000 more".

Line up the whole package, not just the salary

A fair comparison puts each of these side by side for both jobs:

Take-home pay, from the calculator above, with each job's own pension setting.
Employer pension contribution, in pounds rather than percent. Check whether it is paid on your full salary or only on "qualifying earnings" between £6,240 and £50,270, which can halve the value.
Costs of doing the job: commuting, parking, childcare for longer days, and lunches out on office days.
Paid time off: three extra days of holiday on £46,000 is worth roughly £530 of paid time.
Bonus and overtime: discount anything that isn't guaranteed. A target bonus is a possibility, not pay.

The second item is where most people underweight an offer. An employer pension contribution is pay you receive without income tax or National Insurance, which makes £1 of it worth more than £1 of salary to a basic-rate taxpayer.

Where the tax bands bend the maths

The share of a rise you keep depends on where it lands. Between the Personal Allowance and £50,270 a basic-rate employee keeps 72p of each extra pound before any student loan. Above £50,270, income tax jumps to 40% while National Insurance drops to 2%, so the keep-rate falls to 58p. A move from £48,000 to £55,000 is a £7,000 rise, but only about £4,380 of it reaches your account, because most of it sits in the higher-rate band.

The sharpest edge is at £100,000. Above that point the Personal Allowance is withdrawn at £1 for every £2 you earn, until it disappears entirely at £125,140. Someone moving from £96,000 to £108,000 gains £12,000 on paper but takes home only about £5,360 more, and their allowance shrinks to £8,570. If you are negotiating across that line, ask whether part of the rise can be paid as an employer pension contribution or through salary sacrifice instead. Sacrificing £8,000 at £108,000 restores the full allowance and puts £8,000 in the pension for a take-home cost of about £3,040. The £100k tax trap calculator works through that trade-off in detail.

Mistakes that make offers look better or worse than they are

The most common mistake is comparing percentages. A 10% rise is not 10% more take-home: for most people it is 7 to 8%, and less if it crosses a threshold. The second is judging the new job by its first payslip. If your P45 doesn't reach the new employer in time, payroll may put you on an emergency or temporary tax code, and the deductions can look wrong until HMRC updates your code and refunds any overpayment. The third is forgetting that some benefits are taxed. A company car or private medical insurance raises your taxable pay without raising your cash pay, so the take-home on the offer will be lower than a simple salary comparison suggests.

Before you accept

Run both packages through the calculator with each job's real pension terms. Then put a pound value on travel, holiday and pension differences, and compare totals. If the offer is close, the required salary calculator shows the gross figure you would need to match a target take-home, which is a useful number to have in a negotiation. If your current employer offers salary sacrifice and the new one doesn't, the salary sacrifice calculator shows what that difference is worth on its own.

Compare Two Salaries — Offer vs Current