How is my UK take-home pay calculated for 2026/27?
Your UK take-home pay is your gross salary minus Income Tax, National Insurance, pension contributions and any student loan repayment. For 2026/27 the tax-free Personal Allowance is £12,570, so everything after that is what payroll works on.
The order matters, because getting it wrong changes the answer. First, any salary sacrifice (pension, childcare vouchers, cycle-to-work) comes off your gross pay — that lower figure is what both Income Tax and National Insurance are charged on. Next, taxable benefits from your P11D are added back for tax purposes only. Then Income Tax is applied against whatever allowance your tax code grants, National Insurance is worked out on its own thresholds, and student loan deductions are layered on top.
All of this runs through PAYE (Pay As You Earn), the system employers use to deduct tax and National Insurance before your wages are paid, remitting them to HM Revenue & Customs (HMRC). The three key factors that decide your net pay are your gross salary, your tax code, and the deductions you opt into — pension and student loan chief among them.
The 2026/27 figures this calculator uses (all read from a single audited data file, not typed into the page):
| Deduction | Band | Rate |
|---|---|---|
| Personal allowance | £0 – £12,570 | 0% |
| Income tax — basic | £12,571 – £50,270 | 20% |
| Income tax — higher | £50,271 – £125,140 | 40% |
| Income tax — additional | over £125,140 | 45% |
| Employee NI | £12,570 – £50,270 | 8% |
| Employee NI | over £50,270 | 2% |
| Employer NI | over £5,000 | 15% |
| Allowance taper | over £100,000 | −£1 per £2 |
The Personal Allowance has been held at £12,570 since 2021 and, under current policy, stays frozen until April 2031. The Office for Budget Responsibility (OBR) calls the effect fiscal drag: as wages rise but thresholds stand still, more people are pulled into higher tax bands without any headline rate rise. That is why a 2026/27 figure can differ from what the same salary took home a few years ago.
What are the UK Income Tax rates and bands?
In England, Wales and Northern Ireland you pay 20% on taxable income from £12,571 to £50,270, 40% up to £125,140, and 45% above that. The Personal Allowance of £12,570 is deducted first, so only income above it is taxed at all.
Your tax code tells your employer how much allowance to give you — the standard code for 2026/27 is 1257L. Codes such as BR, D0 and K codes change that, and this calculator reads them the way HMRC does, including the 50% regulatory cap on tax collected through a K code.
How does Scottish Income Tax differ in 2026/27?
Scotland uses six Income Tax bands instead of three, set each year by the Scottish Rate Resolution. Lower earners pay marginally less than the rest of the UK, but higher earners pay considerably more.
| Scottish band | Taxable income | Rate |
|---|---|---|
| Starter | £12,571 – £16,537 | 19% |
| Basic | £16,538 – £29,526 | 20% |
| Intermediate | £29,527 – £43,662 | 21% |
| Higher | £43,663 – £75,000 | 42% |
| Advanced | £75,001 – £125,140 | 45% |
| Top | over £125,140 | 48% |
Source: GOV.UK — Scottish Income Tax. Toggle "Scottish taxpayer" (or use an S-prefix tax code) to apply these bands.
How much National Insurance will I pay this year?
Employees pay 8% National Insurance on earnings between £12,570 and £50,270, then 2% on everything above £50,270. There is no National Insurance on the first £12,570, and none at all once you reach State Pension age.
National Insurance Contributions (NICs) are separate from Income Tax and are not devolved, so Scottish taxpayers pay exactly the same NI as everyone else. Class 1 employee NICs build your entitlement to the State Pension and other contributory benefits.
What is the true cost to employers?
Employing you costs your employer far more than your gross salary. For 2026/27 they pay 15% Secondary Class 1 National Insurance on all of your earnings above just £5,000 a year, plus any employer pension contribution.
Source: GOV.UK — Rates and thresholds for employers 2026 to 2027. Tick "Show employer NI & total cost" to see this in the results.
Which student loan plan am I on, and how much is deducted?
You repay 9% of income above your plan's threshold (6% for a postgraduate loan), and if you hold more than one plan the deductions stack. Repayments are handled by the Student Loans Company (SLC) through payroll, exactly like tax.
| Plan | Annual threshold | Rate above threshold |
|---|---|---|
| Plan 1 | £26,900 | 9% |
| Plan 2 | £29,385 | 9% |
| Plan 4 (Scotland) | £33,795 | 9% |
| Plan 5 | £25,000 | 9% |
| Postgraduate | £21,000 | 6% |
Source: GOV.UK — Repaying your student loan. Not sure which plan you hold? It depends on when and where you started studying.
What happens if I earn over £100,000?
Above £100,000 you lose £1 of your £12,570 Personal Allowance for every £2 you earn, and it disappears completely at £125,140. This creates the notorious Personal Allowance taper — an effective marginal tax rate of 60% on income between £100,000 and £125,140.
Source: GOV.UK — Income over £100,000. In the calculator, the result box flags when you are inside the taper zone.
How do allowances, salary sacrifice and dividends change my net pay?
Allowances and salary sacrifice legally reduce the income you are taxed on, so they lift your take-home pay. The Marriage Allowance, the Blind Person's Allowance and pension sacrifice are the three that most often move the number.
The Marriage Allowance lets a non-taxpaying spouse transfer £1,260 of their Personal Allowance to a basic-rate partner, worth up to £252 a year. The Blind Person's Allowance adds £3,250 of tax-free income on top of the standard allowance for 2026/27.
Salary sacrifice is a contractual swap of cash pay for a non-cash benefit — most commonly a pension. Because the contribution comes out before both tax and NI, it is the most tax-efficient way to save, though the government has confirmed a £2,000 cap on the NI saving from pension sacrifice from April 2029. Workplace pensions themselves stem from pension auto-enrolment, which requires employers to enrol eligible staff earning over £10,000.
Source: GOV.UK — Tax on dividends.
Worked example: £42,000 with a 5% sacrifice pension
Take £42,000 with a 5% salary-sacrifice pension. Sacrificing 5% removes £2,100, leaving £39,900 as the amount both tax and NI are charged on.
Income Tax is (£39,900 − £12,570) × 20% = £5,466. Employee NI on the same £27,330 at 8% is £2,186.40. Take-home is £42,000 − £2,100 − £5,466 − £2,186.40 = £32,247.60 a year, about £2,687 a month. Switch the pension pill to "Relief at Source" and NI rises by roughly £168 — the cost of not sacrificing.
How to manually calculate your UK take-home pay
To calculate take-home pay by hand, subtract the Personal Allowance, apply the tax bands, then take off National Insurance and any student loan. These six steps mirror what the calculator does automatically.
- Start from gross pay. Use your annual salary. If you are paid hourly, weekly or monthly, multiply up first (e.g. £16/hour × 37.5 hours × 52 = £31,200).
- Remove salary sacrifice. Subtract pension, childcare or cycle-to-work sacrifice to get your adjusted gross — this comes off before tax and NI.
- Apply the Personal Allowance. Deduct £12,570 to find taxable income (reduce the allowance by £1 per £2 earned over £100,000).
- Calculate Income Tax. Charge 20% up to £50,270, 40% to £125,140 and 45% above — or the six Scottish bands if you are a Scottish taxpayer.
- Calculate National Insurance. Charge 8% on adjusted gross between £12,570 and £50,270, then 2% above £50,270.
- Subtract student loans and total up. Take 9% of income above your plan threshold (6% for postgraduate). Gross minus tax, NI, pension and loans is your take-home pay.
Want to explore variations? If you're paid by the hour, try the hourly wage calculator; to work backwards from a target income, use the required salary calculator. The salary sacrifice calculator shows exactly what a pension swap saves in tax and NI, and the salary comparison tool puts two offers side by side. To see what your take-home actually supports each month, price it in the mortgage repayment calculator, and if you have a second income, check the two jobs tax calculator.