💷UK Salary Calculator

Step-by-Step Guide:

1. Select your profession type: If you're an NHS worker or teacher, tick the appropriate box to automatically apply the correct pay scales and pension schemes.
2. Enter your gross salary: This is your annual salary before any deductions. If you selected NHS or Teacher, choose your band or scale point.
3. Choose your tax region: Scotland has different income tax rates than England, Wales, and Northern Ireland.
4. Add student loan details: Select your repayment plan if applicable - this affects your monthly deductions.
5. Review pension options: NHS and Teachers' pensions are automatically calculated; for others, adjust your contribution percentage.

Personal Allowance

The personal allowance is the amount you can earn tax-free each year. For 2025/26, this is £12,570. However, if you earn over £100,000, your personal allowance reduces by £1 for every £2 earned above this threshold. Once you earn £125,140 or more, you lose your entire personal allowance.

Income Tax Bands (England, Wales & Northern Ireland)

Scottish Income Tax Rates

If you live in Scotland, you pay Scottish Income Tax rates, which differ from the rest of the UK:

The 60% Tax Trap

If you earn between £100,000 and £125,140, you effectively pay a 60% marginal tax rate. This happens because for every £2 you earn above £100,000, you lose £1 of your personal allowance. Combined with the 40% higher rate tax, this creates a 60% effective rate. Pension contributions are an excellent way to avoid this trap, as they reduce your adjusted net income.

Class 1 Employee NI Rates (2025/26)

• Below £12,570: 0% - No NI contributions
• £12,570 to £50,270: 8% on earnings in this band
• Above £50,270: 2% on earnings above this threshold

Note: NI rates were reduced from 12% and 2% to 8% and 2% in April 2024, providing a tax cut for most workers.

Employer NI Contributions

Your employer also pays NI on your behalf at 13.8% on earnings above £9,100. While this doesn't directly affect your take-home pay, it's worth knowing as it represents the true cost of employing you. Some employers offer salary sacrifice schemes that can reduce both employee and employer NI.

NI and State Pension

You need 35 qualifying years of NI contributions to receive the full new State Pension (currently £221.20 per week). Check your NI record on the gov.uk website to ensure you're on track. If you have gaps, you may be able to make voluntary contributions to fill them.

Plan 1 (Loans before September 2012)

• Threshold: £24,990 per year
• Repayment rate: 9% of income above threshold
• Interest rate: Lower of RPI or Bank of England base rate + 1%
• Write-off: 25 years after first April following graduation, or at age 65

Plan 2 (Loans from September 2012)

• Threshold: £27,295 per year
• Repayment rate: 9% of income above threshold
• Interest rate: RPI + up to 3% depending on income
• Write-off: 30 years after first April following graduation

Plan 4 (Scottish Loans)

• Threshold: £31,395 per year
• Repayment rate: 9% of income above threshold
• Write-off: 30 years from first April after course end

Postgraduate Loan

• Threshold: £21,000 per year
• Repayment rate: 6% of income above threshold
• Repaid alongside Plan 1, 2, or 4 if applicable

NHS Pension Scheme

The NHS Pension is a career average revalued earnings (CARE) scheme. Your contributions are tiered based on your pensionable pay:

Employer contribution: 20.6% to 23.7%. The pension accrues at 1/54th of your pensionable pay each year, revalued annually in line with CPI + 1.5%.

Teachers' Pension Scheme

The Teachers' Pension is also a CARE scheme with tiered contributions:

Employer contribution: 28.68%. This is one of the highest employer contributions of any UK pension scheme, making it exceptionally valuable.

What is the difference between gross and net salary?

Gross salary is your total pay before any deductions. Net salary (or take-home pay) is what you actually receive after income tax, National Insurance, pension contributions, and any other deductions like student loans. For example, a £50,000 gross salary typically results in around £38,500 net, depending on your circumstances.

How can I reduce my tax bill legally?

The most effective ways to reduce your tax bill include: increasing pension contributions (which come out of pre-tax income), using salary sacrifice schemes for benefits like childcare vouchers or cycle-to-work, claiming tax relief on professional subscriptions, and making charitable donations through Gift Aid. If you earn over £100,000, pension contributions can help you reclaim your personal allowance.

What is my tax code and why does it matter?

Your tax code tells your employer how much tax-free income you're entitled to. The standard code 1257L means you have the full £12,570 personal allowance. If your code differs, it may indicate additional taxable benefits, underpaid tax from previous years, or adjustments for multiple income sources. Always check your tax code on your payslip and query any unexpected codes with HMRC.

How does London weighting affect my salary?

London weighting is an additional payment for staff working in London to help offset the higher cost of living. For NHS staff, Inner London attracts a supplement of around £3,000 per year. Teachers receive Inner London allowances of approximately £5,000-£7,000 depending on their position. Our calculator automatically applies these supplements when you select the London weighting option.

Should I opt out of my workplace pension to increase take-home pay?

Generally, no. Opting out means losing your employer's contribution, which is essentially free money. For NHS staff, opting out forfeits 20%+ employer contributions. Even for minimum auto-enrolment pensions (3% employer contribution), the combined 8% total contribution is tax-efficient and builds valuable retirement savings. Only consider opting out temporarily if you're in severe financial difficulty.

How accurate is this calculator?

Our calculator uses the latest HMRC tax rates, NI thresholds, and official pay scales for 2025/26. It provides estimates that should closely match your actual pay. However, individual circumstances (such as benefits in kind, company car, or unusual pension arrangements) may cause variations. For precise figures, always check your official payslip or consult a qualified accountant.