Calculate your net take-home pay for employees, freelancers, and contractors
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Your take-home pay is calculated by deducting Income Tax, National Insurance contributions, pension contributions, and any business expenses from your gross income. The exact amount depends on your employment type and income level.
For the 2025-26 tax year, the personal allowance is £12,570. Basic rate (20%) applies to income between £12,571 and £50,270. Higher rate (40%) applies to income between £50,271 and £125,140. Additional rate (45%) applies to income over £125,140.
Employees pay Class 1 National Insurance: 8% on earnings between £12,570 and £50,270, then 2% above that. Self-employed pay Class 2 (£3.45 per week if profits exceed £6,725) and Class 4 (6% on profits between £12,570 and £50,270, then 2% above).
Self-employed individuals, freelancers, contractors, and limited company directors can deduct allowable business expenses from their gross income before calculating tax. Employees generally cannot deduct expenses in this calculator.
Pension contributions reduce your taxable income and National Insurance for employees. This means you pay less tax and NI, making pensions a tax-efficient way to save for retirement.
This calculator provides estimates based on simplified UK tax rates for 2025-26. It doesn't account for student loans, childcare vouchers, or other specific deductions. For precise calculations, consult an accountant or use HMRC's official tools.
Learn everything about UK tax, National Insurance, and proven strategies to keep more of your salary. Our complete guide covers tax reliefs, pension optimization, and tips for employees, freelancers, and contractors.
Read the Complete Guide →Your take-home pay, also known as net pay, is the amount you actually receive after all deductions have been made from your gross salary. In the UK, the main deductions are Income Tax, National Insurance contributions, and any pension contributions. Understanding how these deductions work helps you plan your finances and make informed decisions about salary negotiations, job offers, and tax-efficient savings.
The UK uses a progressive tax system, meaning you pay different rates of tax on different portions of your income. For the 2025/26 tax year (6 April 2025 to 5 April 2026), the tax bands for England, Wales, and Northern Ireland are:
Scotland has its own income tax bands with slightly different thresholds and rates, including Starter, Basic, Intermediate, Higher, Advanced, and Top Rate bands. If you live in Scotland, make sure to select the Scottish tax option in the calculator above.
An important detail: if your income exceeds £100,000, your Personal Allowance is gradually reduced by £1 for every £2 you earn above this threshold. This means it disappears entirely once your income reaches £125,140, creating an effective marginal tax rate of 60% on income between £100,000 and £125,140.
National Insurance (NI) is a separate deduction from Income Tax, even though both are collected by HMRC. NI contributions fund the State Pension, certain benefits, and the NHS. For employees in 2025/26:
Unlike Income Tax, NI does not have a personal allowance in the same sense. The Primary Threshold (£12,570) is the point at which you start paying, and you build up NI credits from the Lower Earnings Limit (£6,396) which count towards your State Pension entitlement even if no NI is actually deducted.
Your tax code tells your employer how much tax-free income you are entitled to. The most common tax code is 1257L, which corresponds to the standard Personal Allowance of £12,570. The number in your tax code is multiplied by 10 to give your tax-free amount. Letters indicate your situation:
If your tax code is wrong, you could be paying too much or too little tax. Check your code on your payslip and contact HMRC if it does not look right.
Workplace pensions are now mandatory in the UK under auto-enrolment. The minimum contribution is 8% of qualifying earnings, with at least 3% paid by your employer. If you contribute through salary sacrifice, your pension payments are deducted before tax and NI, which means you pay less tax and take home more compared to a net pay arrangement where contributions come from after-tax income.
For example, if you earn £35,000 and contribute 5% to your pension through salary sacrifice, that £1,750 comes off your gross pay before any deductions. You effectively save 20% tax and 8% NI on that amount, meaning the real cost to you is closer to £1,260 rather than the full £1,750. Higher-rate taxpayers save even more, making salary sacrifice particularly valuable for those earning above £50,270.
If you have a student loan, repayments are automatically deducted from your salary once you earn above the relevant threshold. The repayment thresholds for 2025/26 are:
Student loan repayments are not tax-deductible and are taken from your net pay after tax and NI. They can make a noticeable difference to your take-home pay, especially if you are on multiple plans simultaneously.
Salary sacrifice is an arrangement where you agree to give up part of your gross salary in exchange for a non-cash benefit. Common salary sacrifice benefits include:
The key advantage is that salary sacrifice reduces your gross pay, so you pay less Income Tax and National Insurance. However, it also reduces your official salary, which could affect mortgage applications, statutory pay entitlements, and other salary-based calculations.
Here are approximate monthly take-home pay figures for 2025/26 (assuming standard tax code 1257L, no pension, no student loan):
Notice how the gap between gross and net pay widens as income increases, reflecting the progressive nature of the UK tax system. Use the calculator above for precise figures tailored to your exact circumstances.
Gross pay is your total salary before any deductions. Net pay (take-home pay) is what you actually receive in your bank account after Income Tax, National Insurance, pension contributions, student loan repayments, and any other deductions have been taken off. For most UK employees, net pay is between 65% and 80% of gross pay, depending on your salary level and deductions.
The UK tax year runs from 6 April to 5 April the following year. This unusual start date dates back to 1752 when Britain adopted the Gregorian calendar. The current 2025/26 tax year started on 6 April 2025 and ends on 5 April 2026. Tax bands and allowances are typically announced in the Autumn Budget and confirmed in the Spring Statement.
Check your tax code on your payslip and compare it to your Personal Tax Account on GOV.UK. You can also use HMRC's online tax checker. If you have changed jobs, have multiple income sources, or receive benefits in kind, your tax code may need updating. HMRC typically sends you a P800 letter at the end of the tax year if you have overpaid or underpaid tax.
Yes. Legitimate ways to reduce your tax bill include maximising pension contributions (up to £60,000 per year), using your ISA allowance (£20,000 per year tax-free), claiming Marriage Allowance if eligible (worth up to £252 per year), making Gift Aid donations, and utilising salary sacrifice schemes. These are all perfectly legal forms of tax planning encouraged by the government.
Freelancers and sole traders pay Income Tax on their profits and Class 2 and Class 4 National Insurance. They complete a Self Assessment tax return each year and pay tax in two instalments (31 January and 31 July). Contractors working through a limited company pay Corporation Tax on company profits and can take income as a combination of salary and dividends, which can be more tax-efficient. However, IR35 rules may apply if you work in a similar way to an employee.