UK Income Tax & NI Calculator
PAYE income tax, Class 1 National Insurance, student loan — 2024/25 HMRC rates.
Your salary
Pension reduces your taxable income
The most accurate UK salary calculator
Not just income tax bands — proper NI with the January 2024 rate cut, pension relief, and student loan repayments all in one calculation.
2024/25 HMRC Rates
2024/25 tax bands: Personal Allowance £12,570, Basic Rate (20%) to £50,270, Higher Rate (40%) to £125,140, Additional Rate 45% above. Class 1 NI at 8% (reduced from 10% in Jan 2024).
NI at correct 8%
National Insurance was cut from 10% to 8% in January 2024, saving a typical higher-rate employee around £450/year. This calculator uses the current 8% rate, not the pre-cut 12%.
Personal Allowance taper
Earners above £100,000 lose £1 of personal allowance for every £2 earned. At £125,140 it is fully withdrawn — creating an effective 60% marginal rate between £100k and £125,140.
Student loan Plans 1–5
All five student loan plans plus the postgraduate loan — each with the correct threshold and repayment rate. Repayments reduce automatically once your income drops below the threshold.
Pension tax relief
Workplace pension contributions (salary sacrifice or relief at source) reduce your taxable income, saving both income tax and potentially NI. Enter your contribution percentage to see the net effect.
Effective vs marginal rate
Two rates that always matter: your effective rate (total taxes ÷ income) and your marginal rate (tax on the next £1). Crucial for evaluating pay rises, bonuses, and side income.
When to use this calculator
New job offer
Compare two salary figures as real take-home — a £5k salary increase does not mean £5k more in your pocket after tax and NI.
Affordability check
Lenders assess affordability on net income. Knowing your actual monthly take-home is the starting point for any mortgage or rental calculation.
Bonus planning
A £10,000 bonus in the higher-rate band nets around £5,900 after tax and NI. Know what to expect before it lands.
Pension decisions
Every extra £1,000 into a pension costs a higher-rate earner only ~£580 in take-home, while reducing tax by £420. See your exact break-even point.
Frequently Asked Questions
What are the UK income tax bands for 2024/25?
The 2024/25 bands are: Personal Allowance £12,570 (0%), Basic Rate 20% on £12,571–£50,270, Higher Rate 40% on £50,271–£125,140, and Additional Rate 45% above £125,140. These thresholds are frozen until at least 2028 under the current government's "fiscal drag" policy.
When did National Insurance change to 8%?
The main Class 1 NI rate was cut from 12% to 10% in January 2024, and then again to 8% in April 2024. This saved the typical higher-rate employee roughly £450–£700 per year compared to the pre-cut 12% rate.
What is the 60% marginal rate trap?
Between £100,000 and £125,140, every £2 of earnings causes you to lose £1 of Personal Allowance. Combined with the 40% Higher Rate, this creates an effective 60% marginal rate on income in this band. Many earners in this range use salary sacrifice or pension contributions to bring gross income below £100,000 and avoid this trap.
How does salary sacrifice affect my NI?
This calculator models pension contributions as reducing taxable income. However, for salary sacrifice specifically (the most tax-efficient pension route), contributions also reduce your NI earnings — saving an additional 8% in NI on the contributed amount. If your employer uses salary sacrifice, your actual NI saving is higher than this calculator shows.
Does this calculator work for Scottish income tax?
Not fully — Scotland has its own income tax bands set by the Scottish Parliament (5 bands: Starter 19%, Basic 20%, Intermediate 21%, Higher 42%, Advanced 45%, Top 48%) which differ from rUK. Use a Scotland-specific calculator for accurate figures if you live in Scotland. National Insurance uses the same UK-wide rules for everyone.
What is not included in this calculator?
This calculator covers the main deductions: income tax, Class 1 NI, pension, and student loan. It does not cover: benefits-in-kind (company car, private medical — these add to your tax liability), Scottish income tax bands, Marriage Allowance, blind person's allowance, payroll giving, or local council tax.
Understanding UK Tax and NI
Most UK earners have three deductions taken directly from their payslip: income tax, National Insurance, and often a student loan repayment. Understanding how each is calculated — and where the leverage points are — is essential for making informed financial decisions.
Income Tax: How the Bands Work
UK income tax is progressive — only the income in each band is taxed at that rate, not the whole salary. Someone earning £60,000 does not pay 40% on the full amount. They pay: 0% on the first £12,570 (Personal Allowance), 20% on £12,571–£50,270 (£7,540), and 40% on £50,271–£60,000 (£3,892). Total income tax: £11,432. Effective rate: 19.1%. Marginal rate: 40%.
National Insurance: The Separate Tax
NI is a separate deduction from income tax, calculated on weekly or monthly earnings (annualised here). The current rate is 8% on earnings between the Primary Threshold (£12,570) and the Upper Earnings Limit (£50,270), and 2% on everything above. An earner on £50,000 pays £3,016 in NI — comparable to their £7,540 income tax bill at that level.
The Best Ways to Reduce Your Tax Legitimately
Pension contributions are the most powerful tool for most UK employees. For a basic-rate taxpayer, contributing £100 to a pension costs only £80 in take-home after tax relief. For a higher-rate taxpayer it costs £60. If your employer offers salary sacrifice, you also save on NI, making the effective cost even lower. For earners between £100k and £125,140, pension contributions can also restore Personal Allowance lost to the taper — a compounded benefit.