UK Income Tax + National Insurance Calculator 2026-27
Tax time — or just curious where your pay actually goes.
Calculate your 2026-27 UK income tax (PAYE) and National Insurance (Class 1 employee). Shows personal allowance, effective rate, and monthly take-home pay. HMRC 2026-27 rates for England, Wales and Northern Ireland.
England/Wales/NI rates by default. Toggle "Scottish income tax rates" in the advanced options for Scottish (SRIT) bands. Estimates only — consult an accountant for advice.
How UK income tax and National Insurance are calculated for 2026-27
PAYE — Pay As You Earn
UK employed income tax is collected via PAYE — your employer deducts income tax and NI directly from your salary each pay period. The personal allowance (£12,570) is tax-free. Above that: 20% basic rate to £50,270; 40% higher rate to £125,140; 45% additional rate above £125,140. Source: GOV.UK — Income Tax rates and Personal Allowances.
National Insurance is separate
Class 1 employee NI is calculated on gross earnings: 8% on earnings between £12,570 and £50,270 per year; 2% above £50,270. NI and income tax are assessed independently on different income definitions.
2026-27 PAYE income tax bands and NI thresholds
| Income | Income tax rate | NI rate |
|---|---|---|
| £0–£12,570 | 0% (personal allowance) | 0% |
| £12,571–£50,270 | 20% basic rate | 8% |
| £50,271–£100,000 | 40% higher rate | 2% |
| £100,001–£125,140 | 60% effective (PA taper) | 2% |
| Above £125,140 | 45% additional rate | 2% |
Frozen thresholds: all UK income tax and NI thresholds remain frozen at 2021-22 levels until at least 2027-28 (fiscal drag).
UK National Insurance Class 1 employee contributions 2026-27
What NI funds
National Insurance contributions fund the State Pension, NHS, and other social security benefits. You need 35 qualifying years of NI contributions to receive the full new State Pension (£11,502/year in 2026-27).
Rate change at UEL
NI drops from 8% to 2% above the Upper Earnings Limit (£50,270). This means the combined marginal rate (income tax 40% + NI 2% = 42%) is actually lower than the basic rate band (20% + 8% = 28%), which is counterintuitive but important for planning.
How income between £100,000–£125,140 creates a 60% effective marginal rate
PA reduced by £1 per £2
For every £2 of income above £100,000, you lose £1 of personal allowance. Between £100,000 and £125,140, this means you pay 40% income tax on the income AND 40% on the allowance lost — an effective marginal rate of 60% (plus 2% NI = 62% total marginal).
How to escape the trap
Pension contributions reduce "adjusted net income" — the figure used to calculate the taper. Contributing the income between £100,001 and £125,140 into a pension can restore your full personal allowance and save the 60% marginal rate. This is one of the most valuable tax planning opportunities for higher earners.
UK take-home pay by gross salary 2026-27
Take-home at different salary levels (England)
| Gross salary | Income Tax | National Insurance | Net annual | Net monthly |
|---|---|---|---|---|
| £20,000 | £1,486 | £595 | £17,919 | £1,493 |
| £25,000 | £2,486 | £995 | £21,519 | £1,793 |
| £30,000 | £3,486 | £1,395 | £25,119 | £2,093 |
| £35,000 | £4,486 | £1,795 | £28,719 | £2,393 |
| £40,000 | £5,486 | £2,195 | £32,319 | £2,693 |
| £50,000 | £7,486 | £2,995 | £39,519 | £3,293 |
| £60,000 | £11,432 | £3,189 | £45,379 | £3,782 |
| £75,000 | £17,432 | £3,489 | £54,079 | £4,507 |
| £100,000 | £27,432 | £3,989 | £68,579 | £5,715 |
| £125,140 | £42,632 | £4,492 | £78,016 | £6,501 |
| £150,000 | £53,618 | £4,989 | £91,393 | £7,616 |
| £200,000 | £76,118 | £5,989 | £117,893 | £9,824 |
Excludes pension contributions and student loan deductions. Scotland has different rates.
Scottish income tax rates 2026-27
Scottish tax bands (separate from rest of UK)
| Band | Income range | Rate |
|---|---|---|
| Personal allowance | Up to £12,570 | 0% |
| Starter rate | £12,571 - £14,876 | 19% |
| Basic rate | £14,877 - £26,561 | 20% |
| Intermediate rate | £26,562 - £43,662 | 21% |
| Higher rate | £43,663 - £75,000 | 42% |
| Advanced rate | £75,001 - £125,140 | 45% |
| Top rate | Above £125,140 | 48% |
Scottish vs rest of UK comparison
£50,000 salary: Scotland £38,819 vs rUK £39,519 (£700 extra tax). £80,000: Scotland £55,469 vs rUK £58,679 (£3,210 extra). Higher earners pay significantly more in Scotland.
NI remains UK-wide
Scottish devolution only covers income tax, not NI. Personal Allowance, ISA rules, pension tax relief all UK-wide.
How to legally reduce UK income tax 2026-27
Pension contributions — tax relief at marginal rate
£1 into pension costs £0.60 as higher-rate taxpayer. Contributions reduce taxable income, can bring you below £100,000 PA taper or higher-rate band. Annual allowance £60,000, 3-year carry-forward.
Salary sacrifice arrangements
Pay into pension via salary sacrifice: saves employee NI (8%) AND employer NI (15%). Employer often shares 15% back. Boosts effective contribution by 15-23% vs direct.
ISA wrapper — tax-free growth
£20,000 annual allowance. All gains, dividends, interest tax-free. Combined with Bed & ISA strategy to shift taxable portfolio gradually to tax-free wrapper.
Gift Aid donations
Extends basic rate band by grossed-up donation. £100 donation: £80 from you + £20 HMRC to charity. Higher-rate claimants get additional 20% back via Self Assessment.
Marriage Allowance
Non-taxpayer spouse transfers £1,260 Personal Allowance to basic-rate spouse — saving up to £252/year. Requires one earning below £12,570.
EIS and VCT investments
EIS: 30% income tax relief on up to £1m. VCTs: 30% relief on £200k, tax-free dividends. High risk — only for experienced investors.
UK effective marginal tax rates and tax traps
Effective marginal rate by band
| Income range | IT | NI | Effective marginal |
|---|---|---|---|
| £12,571 - £50,270 | 20% | 8% | 28% |
| £50,271 - £100,000 | 40% | 2% | 42% |
| £100,000 - £125,140 (PA taper) | 60% effective | 2% | 62% |
| £125,141 - £150,000 | 45% | 2% | 47% |
| Above £150,000 | 45% | 2% | 47% |
The £100k tax trap (60% effective)
Personal Allowance tapers £1 for every £2 above £100,000. Fully withdrawn at £125,140. Creates 60% marginal rate. Solution: pension contributions bringing adjusted net income below £100k.
High Income Child Benefit Charge
Reduces Child Benefit for earners above £60,000, fully clawed back at £80,000. With 2 children, creates 45-55% effective marginal in this band.
Student loan repayment impact
Plan 2: 9% above £27,295. Plan 5: 9% above £25,000. Combined with basic rate + NI = 37-46% effective during repayment period.
UK income tax allowances and reliefs 2026-27
Main allowances
| Allowance | 2026-27 | Who qualifies |
|---|---|---|
| Personal Allowance | £12,570 | All (tapers above £100k) |
| Marriage Allowance | £1,260 transferable | Married couples (one basic rate) |
| Personal Savings Allowance | £1,000 / £500 / £0 | By tax band |
| Dividend Allowance | £500 | Shareholders |
| Blind Person's Allowance | £3,070 | Registered blind |
| Trading & Property | £1,000 each | Small-scale sellers/landlords |
| ISA Allowance | £20,000 | UK residents |
| Pension Annual Allowance | £60,000 | Taxpayers |
Tax codes explained
1257L: standard (£12,570 allowance). BR: basic rate 20% all income (second jobs). D0: 40% all income. K: more tax (company benefits). Check tax code on payslip against circumstances.
Self Assessment requirements
Must file if: self-employed £1,000+, earn over £100k, untaxed income over £2,500, claim PSA relief, company director. Deadline 31 January. £100 automatic late penalty.
UK Self Assessment tax return guide
Who must file Self Assessment
Self-employed earning £1,000+. Total income over £100,000. Untaxed income over £2,500 (rental, dividends, savings). Company director. Partner in partnership. Claim PSA or specific reliefs. High Income Child Benefit Charge (income over £60,000 with child benefit).
Self Assessment deadlines
| Deadline | Action |
|---|---|
| 5 October | Register for SA if first time |
| 31 October | Paper return deadline |
| 31 January | Online return + tax payment due |
| 31 July | Second payment on account (if applicable) |
Penalties for late filing
1 day late: £100. 3 months: +£10/day (max £900). 6 months: +£300 or 5% of tax (whichever higher). 12 months: further £300 or 5%. Plus late payment penalties and interest at 7.75% (2025).
Payments on account
If tax bill over £1,000: must make payments on account for following year. Each is 50% of previous year's liability. Due 31 January and 31 July. Balancing payment + first POA for next year creates large January bill.
Making Tax Digital (MTD)
From April 2026: sole traders/landlords with income over £50,000 must use MTD-compatible software and submit quarterly updates. Extended to £30,000+ from April 2027. Plan ahead for software transition.
UK student loan repayment 2025-26
Student loan plans and thresholds
| Plan | Threshold | Rate | Who it applies to |
|---|---|---|---|
| Plan 1 | £26,065 | 9% | Eng/Wales before Sep 2012; NI; Scotland |
| Plan 2 | £28,470 | 9% | Eng/Wales from Sep 2012 |
| Plan 4 | £32,745 | 9% | Scotland from 2021 |
| Plan 5 | £25,000 | 9% | Eng from Aug 2023 |
| Postgraduate | £21,000 | 6% | Master's/doctorate loan |
Combined rates with tax
Plan 2 graduate earning £50k: Income Tax 20% + NI 8% + Student Loan 9% = 37% marginal rate. Plan 2 + Postgrad (both): 43% marginal. Higher rate Plan 2: 49% marginal. Significant deduction stack.
Loan write-off periods
Plan 1: written off at 65 or 25 years. Plan 2: 30 years after first April due. Plan 4: written off at 65 or 30 years. Plan 5: 40 years after first April due. Most graduates won't clear Plan 2 debt — write-off expected.
Voluntary repayment math
Most graduates shouldn't voluntarily repay Plan 2/5 — likely to be written off. Only makes sense if high earner likely to clear full balance within term. Run calculator to check your specific case.
UK National Insurance contributions 2026-27
Class 1 NI (employees)
| Income band | Rate |
|---|---|
| Below £12,570 (Primary Threshold) | 0% |
| £12,571 - £50,270 | 8% |
| Above £50,270 (Upper Earnings Limit) | 2% |
Employer's NI (Class 1 Secondary)
2026-27: 15% on wages above £5,000 Secondary Threshold. Major cost to employers. Salary sacrifice schemes effectively save both employee and employer NI. Apprenticeships and under-21s exempt.
Self-employed NI
| Class | Rate | Notes |
|---|---|---|
| Class 2 | £3.45/week if profits over £6,725 | Abolishing from 2024-25 for most |
| Class 4 | 6% between £12,570-£50,270; 2% above | Calculated via SA return |
Voluntary Class 3 NI
£17.45/week (2026-27). Fill gaps in NI record to qualify for State Pension. 35 qualifying years needed for full State Pension. Usually worthwhile if recent gap or close to pension age.
NI benefits that depend on record
State Pension (main one). Bereavement support. Contribution-based JSA/ESA. Maternity Allowance. Check NI record via GOV.UK. Fill gaps before becoming too old to claim benefits.
UK pension contributions and tax relief savings
Tax relief by income level
| Income | Marginal rate | £1,000 pension net cost | Effective tax saving |
|---|---|---|---|
| £30,000 (basic) | 20% + 8% NI | £800 | £200 Income Tax |
| £60,000 (higher) | 40% + 2% NI | £600 | £400 Income Tax |
| £110,000 (taper zone) | 60% effective | £400 | £600 (restores PA) |
| £150,000 (additional) | 45% + 2% NI | £550 | £450 Income Tax |
Salary sacrifice boost
Salary sacrifice pension contribution saves employee NI (8% basic, 2% higher) AND employer NI (15%). Many employers share the employer NI saving. On £10k salary sacrifice: saves £800-1,500 NI on top of income tax relief.
Annual allowance management
£60,000/year standard. Tapered above £260k adjusted income (min £10k). Carry forward 3 years unused allowance. Track carefully — overcontributions taxed at marginal rate (tax charge).
UK tax codes explained 2026-27
Common UK tax codes
| Code | Meaning |
|---|---|
| 1257L | Standard — full Personal Allowance £12,570 |
| K code (e.g. K475) | Deductions exceed allowance — more tax withheld |
| BR | Basic rate 20% on all — usually second job |
| D0 | Higher rate 40% on all — third job or specific case |
| D1 | Additional rate 45% on all |
| 0T | No PA allocated — emergency or tax code unknown |
| NT | No tax — specific cases (some pensioners abroad) |
| M | Marriage Allowance received (1.25 × standard) |
| N | Marriage Allowance transferred (0.75 × standard) |
| W1/M1 suffix | Emergency — non-cumulative |
| Prefix S (e.g. S1257L) | Scottish taxpayer |
| Prefix C (e.g. C1257L) | Welsh taxpayer |
When tax codes change
HMRC notifies you of tax code changes via P2 Coding Notice. Common reasons: new job, additional income, company car, medical insurance benefit, underpayment recovery, unclaimed allowances.
Check your tax code
View code on payslip, P60, or via HMRC Personal Tax Account. If wrong: contact HMRC on 0300 200 3300 or via online account. Wrong code = over or underpaying each month.
UK tax-deductible expenses and allowable deductions
Employment expenses (via Section 336 ITEPA)
Expenses incurred 'wholly, exclusively, and necessarily' in performing employment duties. Uniforms and protective clothing (if required). Professional subscriptions to HMRC-approved bodies. Business mileage if not reimbursed fully by employer (45p/25p rates). Use of home for work — limited allowance if employer requires home working.
Self-employment allowable expenses
Business-related: materials, stock, equipment, travel (not commute), insurance, professional fees, marketing, office costs. Partial home use: proportion of utilities, council tax, internet. Simplified rates available for common items. Must keep records 5 years.
Rental property expenses
Mortgage interest: 20% tax credit only (Section 24). Letting agent fees. Repairs and maintenance (not improvements). Insurance. Legal fees for new let or renewal. Replacement of domestic items (not first provision).
Gift Aid donations
£100 donation becomes £125 to charity (20% basic rate). Higher rate taxpayers claim extra 20% via Self Assessment (saving £25 on £125 grossed donation). Increases basic rate band — useful for crossing 40% threshold planning.
Capital allowances (self-employed/business)
Annual Investment Allowance: 100% deduction on qualifying plant and machinery up to £1 million. First Year Allowances for eco investments. Writing Down Allowances on assets above AIA. Complex area — structure purchases around tax year for best relief.
Common UK income tax scenarios
Two jobs tax calculation
Personal Allowance used against primary job (tax code 1257L). Secondary job: tax code BR (20% on all) or higher. End of year: HMRC reconciles total income — may owe extra or get refund.
Freelance alongside employment
Employee via PAYE. Freelance via Self Assessment. Trading Allowance: first £1,000 freelance income tax-free. Above £1,000: must register SA. Separate NI (Class 2 + 4) on self-employed portion.
Bonus and pay rise timing
Bonus typically taxed higher in month received due to cumulative PAYE calculation. Evens out by year end. Pay rise mid-year: new salary from effective date, PAYE adjusts automatically.
Moving to/from UK mid-year
Split year treatment possible if specific tests met. Tax liability based on UK residence status + days spent. Complex — seek advice for year of move. Overseas income can complicate significantly.
Student working part-time
Personal Allowance £12,570 regardless of age. Student working limited hours under PA: no tax. Above PA: standard tax + NI above threshold. Not exempt just for being student.
Pensioner with multiple income sources
State Pension + private pension + part-time work. Each source may have different tax code. Personal Allowance used against first source. HMRC reconciles total.
FAQ
Frequently asked questions about UK income tax
How much income tax do I pay on £50,000 UK?
Personal allowance £12,570 tax-free. Basic rate 20% on £37,430 = £7,486. NI 8% on £37,700 = £3,016. Total deductions: £10,502. Take-home £39,498/year (£3,292/month).
Is the personal allowance same for everyone?
Standard PA is £12,570. Reduced £1 per £2 above £100,000, nil at £125,140. Blind Person's Allowance (+£3,070) and Marriage Allowance adjust effective allowance. Your tax code shows your PA.
Do Scottish residents pay different income tax?
Yes. Scottish rates: Starter 19%, Basic 20%, Intermediate 21%, Higher 42%, Advanced 45%, Top 48%. Generally higher taxes for higher earners. NI rates UK-wide.
How does a pension contribution affect take-home?
Pension contributions reduce taxable income. £1,000 contribution saves £200 for basic rate, £400 for higher rate, up to £600 for PA taper zone (60% effective saving). Best tax planning tool available.
What is the £100k tax trap?
Personal Allowance tapers £1 per £2 above £100,000, creating 60% effective marginal rate between £100k-£125,140. Solution: pension contribution bringing adjusted net income below £100k restores full PA.
What National Insurance do I pay?
Class 1 (employees): 8% between £12,570 and £50,270, 2% above. Class 2 and Class 4 for self-employed. Class 3 (voluntary) to fill gaps in NI record for State Pension.
Do I pay tax on dividends?
£500 dividend allowance 2026-27. Above: 8.75% basic, 33.75% higher, 39.35% additional. ISA dividends tax-free.
When do I need to file Self Assessment?
By 31 January following tax year end (5 April). Self-employed, £100k+ earners, untaxed income over £2,500, company directors all need to file. Late = automatic £100 penalty, plus daily charges after 3 months.
How do I reduce income tax UK?
Pension contributions (marginal rate relief), ISA (future tax-free growth), Gift Aid (basic rate band extension), Marriage Allowance (£252/year), EIS/VCT (30% relief but high risk), salary sacrifice (NI saving).
What is PAYE?
Pay As You Earn — income tax deducted at source by employer each pay cycle. HMRC provides your tax code. Most employees need no further action. Self-employed or complex income: must file Self Assessment.
How much tax on £100,000 UK?
Income Tax: £27,432. NI: £3,989. Take-home: £68,579. Effective rate 31.4%. Add pension contributions for significant tax reduction — contributing £7,500 reduces tax by £3,000 while building retirement pot.
What is the High Income Child Benefit Charge?
Reduces Child Benefit for earners above £60,000, fully clawed back at £80,000. 1% of Child Benefit repaid for every £200 over £60k. Families can opt out of Child Benefit to avoid the charge, though this affects NI credit record.
Where these figures come from
Every threshold and tax rate on this page is taken from HM Revenue & Customs (HMRC) via GOV.UK — the source of record for UK income tax, National Insurance, VAT, and capital gains tax.
- Income Tax rates & Personal Allowance — GOV.UK — Income Tax rates and Personal Allowances.
- National Insurance rates & thresholds — GOV.UK — National Insurance rates and categories.
- Personal Allowance taper (£100k+) — GOV.UK — Income over £100,000.
- Capital Gains Tax rates & allowance — GOV.UK — Capital Gains Tax rates.
- Dividend Tax — GOV.UK — Tax on dividends.
- ISA annual allowance — GOV.UK — Individual Savings Accounts.
Last checked: April 2026. Rates and thresholds are reviewed against the source of record each November, when annual adjustments for the following tax year are published.
Select the question that matches where you are right now.
Your result shows the estimated tax position based on the income, deductions, and offsets you entered — using current published tax rates and thresholds.
Use this to understand your tax position before lodging. Compare scenarios — a salary sacrifice, additional deduction, or income change — to see how each affects your tax.
Not a Self Assessment return or HMRC determination. Your actual tax outcome depends on your full Self Assessment, including items not modelled here. Consult a chartered accountant or tax adviser for complex situations.
Uses current published rates and thresholds. All calculations run in your browser — no data is stored or sent to any server.
Tax results are driven by your total taxable income, marginal rate bracket, and eligible deductions. The interaction between these three determines your effective tax rate.
Each dollar above a threshold is taxed at the next rate. Moving from the 32.5% to the 37% bracket doesn't mean all income is taxed at 37% — only the portion above the threshold.
Deductions reduce taxable income (saving at your marginal rate). Offsets reduce tax payable dollar-for-dollar. An offset is worth more than a deduction of the same amount.
To reduce your tax, focus on legitimate strategies that shift income timing, increase deductions, or take advantage of concessional structures.
Claim all eligible work-related expenses, home office costs, and investment deductions. A tax agent can identify deductions you may be missing.
Contributions up to the concessional cap are taxed at 15% inside super instead of your marginal rate — an immediate saving for anyone above the 19% bracket.
Prepaying deductible expenses before 5 April (UK tax year end) or deferring income into the next tax year can shift your liability between tax years.
Tax is connected to income, super, and investment decisions. Use these calculators to model the adjacent factors.
See exactly how much reaches your bank account after income tax, National Insurance, and any Student Loan deductions.
Pay calculator →See the tax benefit of additional salary sacrifice or voluntary super contributions.
Super contributions →If you're selling an asset, model the CGT impact including the 50% discount for assets held over 12 months.
CGT calculator →