How it works
What the PAYE calculadora does
Take-home pay in the UK is what you keep after HMRC takes its share via PAYE (Pay As You Earn). For a typical employee, three things come off your gross salary before the money reaches your bank: Income Tax, National Insurance (NI) and, if you borrowed for university, your Student Loan repayment. Many people also sacrifice a chunk of pay into a pension, which changes the maths further.
This calculadora applies the 2025/26 thresholds published by GOV.UK and HMRC. It handles the Personal Allowance taper above £100,000, the Scottish income tax bands, and every Student Loan plan currently in repayment (1, 2, 4, 5 and Postgraduate Loan). Salary sacrifice pension contributions are applied before tax, so your Income Tax and NI both fall when you dial up the pension percentage.
How PAYE take-home pay is calculated
Here is how the numbers actually land. Take someone on £38,000 a year in England, sacrificing 5% into a pension and paying off a Plan 2 student loan.
The step-by-step calculation:
- Pension: 5% × £38,000 = £1,900 into your pension. You now have £36,100 of taxable pay.
- Personal Allowance: £12,570 is tax-free, leaving £23,530 of taxable income.
- Income Tax: all of it sits in the basic-rate band (20%): £23,530 × 20% = £4,706.
- National Insurance: 8% on the slice between £12,570 and £36,100 = £23,530 × 8% = £1,882.40.
- Student Loan (Plan 2): 9% of income above £28,470 = (£36,100 − £28,470) × 9% = £686.70.
- Take-home: £36,100 − £4,706 − £1,882.40 − £686.70 = £28,824.90 a year, or £2,402 a month.
The 2025/26 Income Tax bands (England, Wales & NI)
Everything above the Personal Allowance is split into three bands. Scottish taxpayers follow a separate set of bands with six rates rather than three.
| Band | Taxable income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Basic rate | £12,571 – £50,270 | 20% |
| Higher rate | £50,271 – £125,140 | 40% |
| Additional rate | Over £125,140 | 45% |
The 60% tax trap between £100k and £125,140
The Personal Allowance tapers by £1 for every £2 you earn above £100,000. That means a £1 pay rise in this range can cost you 40p in higher-rate tax plus a 20p hit from losing tax-free allowance — an effective 60% marginal rate. Salary sacrifice into a pension is the standard way to avoid it.
National Insurance in plain English
From April 2024, Class 1 employee National Insurance dropped to 8% on earnings between £12,570 and £50,270, with 2% on anything above. The employer also pays Class 1 NI at 13.8% on top — that's not in your take-home maths, but it's why many firms now offer salary sacrifice so enthusiastically.
Student Loan plans — how to find yours
If you studied in the UK, HMRC deducts your loan repayment directly through PAYE once your income crosses the plan's threshold. You pay a flat 9% (or 6% for the Postgraduate Loan) on the amount above.
| Plan | Who it applies to | Threshold (2025/26) | Rate |
|---|---|---|---|
| Plan 1 | Pre-2012 England & Wales / Northern Ireland | £26,065 | 9% |
| Plan 2 | England & Wales 2012–Jul 2023 | £28,470 | 9% |
| Plan 4 | Scotland | £32,745 | 9% |
| Plan 5 | England from Aug 2023 | £25,000 | 9% |
| Postgraduate | Masters / PhD loans | £21,000 | 6% |
How to actually reduce your tax legally
Most people are not trying to avoid tax — they just don't want to leave money on the table. Four levers reliably shift the numbers in your favour:
- Salary sacrifice pension. The money goes in gross, and you save 20%/40%/45% Income Tax plus 8%/2% NI on the contribution. For most higher-rate payers, every £60 of take-home sacrificed becomes £100 in the pension.
- Marriage Allowance. If your partner earns under the Personal Allowance and you're a basic-rate taxpayer, they can transfer £1,260 of allowance to you — worth about £252 a year.
- Tax code check. An incorrect code is the single most common cause of over- or under-paying tax. Check yours on the HMRC app.
- Cycle-to-work and electric-vehicle salary sacrifice save NI and Income Tax on commuting costs.
Common mistakes with take-home calculadoras
A £35,000 job advert is not £35,000 in your account. It's also not the same after pension, after student loan or after a Scottish post-code. Three things trip people up:
- Assuming the headline figure from a rival calculadora applies in your region (Scotland differs from England).
- Forgetting to include the Postgraduate Loan — it stacks on top of Plan 1/2/5 if you have both.
- Confusing employee NI (which affects you) with employer NI (which doesn't).
Who this calculadora is for
The numbers on this page assume you are a regular employee on standard PAYE — which covers the vast majority of UK workers. If you are a sole trader, a company director paying yourself in dividends, or juggling multiple PAYE jobs, your real tax bill flows through Self Assessment. Use this as a sensible starting figure, not the final word.
For the most accurate official figure, use GOV.UK's Estimate your Income Tax tool and check your tax code on the HMRC app. If anything looks off by more than £20 a month, ring HMRC on 0300 200 3300.