Take-Home Pay Calculator UK 2026/27

Enter your gross salary and get an instant breakdown of Income Tax, National Insurance, pension, and student loan deductions — with your exact monthly and weekly net pay. Covers England, Wales, and Scotland.

1. Your Salary
?Enter your salary before any deductions. You can switch between annual, monthly, or hourly below.
£
2. Tax & Location
?Scottish taxpayers pay different Income Tax rates under the Scottish Rate of Income Tax (SRIT). NI rates are the same across the UK.
?The standard code for 2026/27 is 1257L. If you have a different code, enter it here — e.g. 1100L, BR, K500, D0. Leave as 1257L if unsure. Use the Tax Code Checker to verify yours.
3. Pension & Student Loan
?Enter your own contribution as a percentage of gross salary, or a fixed monthly amount. Salary sacrifice pensions reduce your gross pay before tax — select the type below.
%
?Plan 2: started university 2012–2023 in England/Wales, threshold £25,000. Plan 5: started from 2023 in England, threshold £25,000 (rising to £31,395 from 2026). Postgraduate: threshold £21,000, 6% rate.

How Your Take-Home Pay is Calculated in 2026/27

£12,570
Personal Allowance — frozen for the fifth consecutive year
28%
Combined Income Tax + NI on basic-rate earnings (20% + 8%)
£185
Extra tax paid in 2026/27 by a full-time NLW worker vs 2025, due to fiscal drag

Your employer deducts three things from your gross pay each month before it reaches your bank account: Income Tax, National Insurance contributions (NI), and any voluntary deductions you have set up — such as pension contributions or salary sacrifice arrangements. Student loan repayments are collected the same way, via HMRC's PAYE system.

The order matters. Income Tax is calculated on your gross salary minus any salary sacrifice pension. NI is calculated on gross salary above the Primary Threshold (£12,570 per year), without any reduction for pension sacrifice — unless your employer operates a separate scheme. Relief-at-source pensions are taken from your net pay, with basic-rate tax relief added by your pension provider.

Deduction order for a standard employee in 2026/27

£35,000 gross salary, 5% salary sacrifice pension, Plan 2 student loan, England
Gross annual salary£35,000
Salary sacrifice pension (5%)−£1,750
Adjusted gross for Income Tax£33,250
Personal Allowance−£12,570
Income Tax @ 20% on £20,680−£4,136
NI @ 8% on £22,430 (above £12,570)−£1,794
Student loan Plan 2 @ 9% on £6,530 (above £28,470)−£588
Annual net take-home£26,732
Monthly net take-home£2,228

England/Wales Income Tax bands 2026/27

Band Taxable income Rate NI rate (employee) Effective combined
0% £0 – £12,570 0% 0% 0%
Basic £12,571 – £50,270 20% 8% 28%
Higher £50,271 – £125,140 40% 2% 42%
PA taper £100,000 – £125,140 60% effective 2% 62% effective
Additional Over £125,140 45% 2% 47%

Scotland Income Tax bands 2026/27

Band Taxable income Scottish IT rate NI rate (UK-wide)
Starter £12,571 – £14,876 19% 8%
Basic £14,877 – £26,561 20% 8%
Intermediate £26,562 – £43,662 21% 8%
Higher £43,663 – £75,000 42% 2%
Advanced £75,001 – £125,140 45% 2%
Top Over £125,140 48% 2%
Scottish taxpayers pay NI at UK-wide rates (8% / 2%) regardless of the Scottish IT bands. The difference is purely in Income Tax rates and thresholds. A Scottish higher-rate taxpayer earning £50,000 pays approximately £1,500 more per year in Income Tax than an equivalent English taxpayer.

Three Real Salary Scenarios: What You Actually Keep

The gap between gross and net widens significantly as salary rises — not just in absolute terms, but as a proportion. Below are three representative cases showing how deductions stack up at different points of the income distribution in 2026/27, England.

Scenario A — National Living Wage, full-time (£23,810 gross)

37.5 hrs/week at £12.21/hr. No pension, no student loan. Standard tax code 1257L.
Gross annual£23,810
Income Tax @ 20% on £11,240−£2,248
NI @ 8% on £11,240−£899
Annual net£20,663
Monthly net£1,722
Effective deduction rate13.2%

At NLW, the effective combined rate is relatively low because a large share of earnings falls within the Personal Allowance and NI threshold. However, compared to 2025/26 (when NLW was £11.44), this worker now earns £1,574 more gross but pays an additional £315 in tax and NI — so only £1,259 reaches their account. The 20% marginal rate on gross pay growth is the invisible cost of the wage rise.

Critically, this salary puts the worker well within Universal Credit eligibility if they have children or housing costs. Use the UC Calculator to see the combined household income including any UC entitlement at this earnings level.

Scenario B — UK median salary (£37,430 gross)

No pension, Plan 2 student loan. Standard tax code. England.
Gross annual£37,430
Income Tax @ 20% on £24,860−£4,972
NI @ 8% on £24,860−£1,989
Student loan Plan 2 @ 9% on £8,960−£806
Annual net£29,663
Monthly net£2,472
Effective deduction rate (with student loan)20.7%

The student loan here costs £806/year — equivalent to losing almost a full month of a NLW worker's take-home. For a worker without a student loan at this salary, net pay rises to £30,469 (£2,539/month), a meaningful £67/month difference. Median earners in England without student loans are typically outside UC eligibility unless they have significant housing costs or children. Check the Benefits Cliff Calculator for the precise cutoff.

Scenario C — Higher rate taxpayer (£65,000 gross)

5% salary sacrifice pension. No student loan. Standard code. England.
Gross annual£65,000
Salary sacrifice pension (5%)−£3,250
Adjusted gross for tax£61,750
Income Tax: 20% on £37,700 + 40% on £11,480−£12,132
NI: 8% on £37,700 + 2% on £14,730−£3,311
Annual net (after pension deduction)£46,307
Monthly net£3,859
Effective deduction rate28.7%

The salary sacrifice pension here costs only £3,250 in reduced take-home despite £3,250 of gross pay being diverted — because the pension contribution saves £975 in Income Tax and £130 in NI that would otherwise have been deducted. The net cost of the pension is £2,145, not £3,250. Increasing contributions to bring total gross pay below £50,270 would save a further £200 in NI by moving the marginal NI rate from 2% to the relevant lower figure on that slice. Model the exact saving with the Salary Sacrifice Calculator.

The £100,000 trap. At £100,000, the Personal Allowance begins to taper — £1 lost for every £2 earned above £100,000. Between £100,000 and £125,140, your marginal Income Tax rate is effectively 60% (plus 2% NI = 62%). A £10,000 bonus in this range nets you only £3,800. Pension sacrifice is the primary tool for avoiding this band — diverting £25,140 into a pension from a £125,140 salary restores the full Personal Allowance and saves approximately £7,542 in tax.

Salary Sacrifice vs Relief at Source: Which Pension Method Gives You More?

Pension contributions can be structured two ways, and they produce different net pay outcomes at the same gross contribution rate.

Salary Sacrifice — deducted before tax and NI
Your contractual salary is reduced by the contribution amount. You pay Income Tax and NI on the lower salary. At the basic rate, a 5% contribution (£1,750 on £35,000) saves £350 in Income Tax and £140 in NI — the net cost of contributing is £1,260, not £1,750. Your employer also saves 13.8% Employer NI on the sacrificed amount; many employers pass some of this saving to the employee as enhanced contributions.
Relief at Source — deducted after tax, basic-rate relief added by pension provider
You pay into the pension from your net pay, then HMRC adds 20% basic-rate tax relief directly into the pension fund. Higher-rate taxpayers must claim the additional 20% relief via Self Assessment — it is not added automatically. The net cost of a £1,750 contribution at basic rate is £1,400 (£1,750 minus 20% relief). Slightly worse than salary sacrifice because you still pay NI on the full gross salary.
Pension type Gross contribution IT saving NI saving Net cost to employee
Salary sacrifice (basic rate) £1,750 £350 £140 £1,260
Relief at source (basic rate) £1,750 £350 £0 £1,400
Salary sacrifice (higher rate) £1,750 £700 £35 £1,015
Relief at source (higher rate)* £1,750 £700 £0 £1,050

*Higher-rate relief at source requires a Self Assessment claim for the additional 20%. Not automatically applied.

Salary sacrifice wins at every rate — but check whether your employer scheme offers it. Not all do, and salary sacrifice can affect statutory pay calculations (SMP, SSP) based on your new lower contractual salary. It may also affect mortgage affordability assessments. Use the Salary Sacrifice Calculator to model both options side by side for your exact salary.

Student Loan Repayments: Which Plan Are You On and What Do You Actually Pay?

Student loan repayments are calculated as a percentage of earnings above a threshold — not on the whole salary. The plan you are on determines both the threshold and the rate. Many employees have the wrong plan applied by their employer, leading to over- or under-repayment.

Plan Who 2026/27 threshold Rate Annual cost at £35,000
Plan 1 England/Wales pre-2012; Scotland/NI pre-2021 £22,015 9% £1,169
Plan 2 England/Wales 2012–2023 £28,470 9% £588
Plan 4 Scotland from 1998 £31,395 9% £324
Plan 5 England from 2023 £25,000 9% £900
Postgraduate Postgraduate loans £21,000 6% £840
Plan 2 and Plan 5 can run concurrently if you have both an undergraduate and postgraduate loan. Repayments are calculated independently on separate thresholds and added together. At £35,000, a Plan 2 + Postgraduate borrower repays £1,428/year — nearly £120/month — from net pay.

If you have a Plan 1 loan and your employer is deducting at the Plan 2 threshold, you are likely being under-deducted — the opposite can cause overpayment. Check your payslip plan code against the Student Loans Company's plan checker.

2025/26 vs 2026/27: The Invisible Tax Rise From Frozen Thresholds

No Income Tax or NI rates changed in April 2026. But the tax burden still rose for most workers — because wages are rising while the thresholds at which tax is deducted remain frozen. This is called fiscal drag: inflation and wage growth push more income into taxable bands without any change in the headline rates.

Salary Net pay 2025/26 Net pay 2026/27 Change in net Note
£23,795 → £23,810 (NLW rise) £20,648/yr £20,663/yr +£15 Wage rose £1,574 gross; extra tax/NI absorbed £1,559
£35,000 £27,487/yr £27,498/yr +£11 Salary unchanged; no change in deductions
£37,430 (new median) £29,038/yr £29,469/yr +£431 Pay rise of £1,480 gross; effective rate 70.9% on the increment
£50,270 (threshold edge) £37,023/yr £37,023/yr £0 Threshold frozen — position unchanged
£65,000 £44,832/yr £44,832/yr £0 Salary unchanged; deductions unchanged

The starkest effect is on NLW workers. Their gross pay rose 6.7% (£1,574/year), but the combination of Income Tax and NI on the new earnings means only £15 more reaches their net pay. The remaining £1,559 was absorbed in deductions — an effective marginal rate of 99.1% on the NLW uplift. This is the mathematical consequence of frozen thresholds meeting a legislated minimum wage increase.

Five Mistakes People Make When Estimating Their Take-Home Pay

1
Dividing gross annual by 12 and calling it net monthly
The most common error. £35,000 ÷ 12 = £2,917 — but take-home is approximately £2,291. The difference (£626/month, or £7,509/year) is not profit for HMRC to claim later: it is deducted at source every month. Budgeting from gross rather than net is a structural mistake that leads to persistent shortfalls.
2
Ignoring the emergency tax code on a new job
When you start a new job without a P45, your employer may apply a W1/M1 emergency code. This treats each pay period in isolation — meaning you lose the benefit of unused personal allowance from earlier in the year. You can reclaim any overpayment from HMRC directly or at year end. Check your payslip tax code in month one.
3
Forgetting that student loan repayments are not optional deductions
Student loans are collected by HMRC via PAYE — they appear on your payslip as a mandatory deduction, not a voluntary one. At Plan 2 on a £40,000 salary, you repay £1,047/year automatically. Not accounting for this in your budget leaves a gap of £87/month. The loan only disappears when fully repaid or — under Plan 2 — after 30 years.
4
Assuming a pay rise is worth its full face value
A £2,000 annual pay rise from £33,000 to £35,000 adds £1,440 to net pay (28% combined deduction rate at basic rate). If you also have a Plan 2 student loan, net pay rises by only £1,260. If the rise tips you into High Income Child Benefit repayment territory, the real gain may be close to zero. Always model the full picture — the Benefits Cliff Calculator handles all of these interactions simultaneously.
5
Using an outdated calculator from a previous tax year
The National Living Wage changed on 1 April 2026. Student loan thresholds are uprated annually. Although headline IT and NI rates did not change this year, NLW workers are now in a different deduction position. Always verify a calculator's stated tax year before relying on its output — look for "2026/27" or "April 2026" in the page title or methodology.

Frequently Asked Questions

How do I calculate my monthly take-home pay from an annual salary?

The formula is: (Gross Annual − Income Tax − NI − Pension Sacrifice − Student Loan) ÷ 12. Income Tax is calculated on taxable income (gross minus Personal Allowance and any salary sacrifice); NI is on gross earnings above £12,570 at 8% up to £50,270, then 2% above. For an England-based employee on £35,000, standard code, no deductions other than tax and NI: annual net ≈ £27,498, monthly net ≈ £2,291. This calculator handles all of the above automatically.

What is the 2026/27 Personal Allowance?

£12,570 — unchanged since 2021/22 and frozen until at least 2028. It starts to taper for incomes above £100,000 (losing £1 of allowance per £2 earned over the threshold) and reaches zero at £125,140. Marriage Allowance allows one partner to transfer £1,260 of unused allowance to the other, reducing their tax bill by up to £252/year.

What tax code should I have in 2026/27?

The standard code for most employees is 1257L. The number represents your annual tax-free allowance divided by 10 (£12,570 ÷ 10 = 1,257); the L suffix means you receive the standard Personal Allowance. If you have untaxed income, a company car, or owe tax from a previous year, HMRC adjusts the number downward (or issues a K code). Use the Tax Code Checker to verify whether yours is correct.

Does my take-home pay affect Universal Credit?

Yes — directly. UC is based on net earnings (after tax and NI), not gross. The UC taper removes 55p of benefit per £1 of net earnings above your work allowance. Because the calculator outputs net monthly pay, you can feed that figure straight into the UC Calculator to see your combined household income.

How does salary sacrifice reduce my tax bill?

Salary sacrifice reduces your contractual gross pay by the amount sacrificed. Because Income Tax and NI are calculated on this lower figure, both are reduced. At the basic rate, a £1,000 pension sacrifice saves £200 in Income Tax and £80 in NI — the contribution costs £720 in real terms. At the higher rate, the same sacrifice saves £400 + £20, costing only £580 net. See the Salary Sacrifice Calculator for an interactive model.

I am paid hourly — how do I calculate my annual and monthly net pay?

Multiply your hourly rate by your contracted weekly hours, then by 52 to get gross annual pay. For example: £14.00/hr × 30 hrs × 52 = £21,840 gross. From there, apply the standard tax and NI calculation. The calculator above handles this conversion automatically when you select "Hourly" as the salary period and enter your contracted hours.

Disclaimer: Results are estimates for 2026/27 based on published HMRC rates and thresholds. Individual circumstances — multiple employments, benefits in kind, irregular pay — may affect your actual deductions. For personalised advice contact HMRC or a qualified tax adviser.