How UK Take-Home Pay Works
Your take-home (net) pay is what lands in your bank account after three main deductions: income tax, National Insurance, and any pension contribution. This calculator shows all three using the current 2026/27 UK bands and thresholds, with the pension contribution treated as salary sacrifice — the most tax-efficient way to save into a workplace pension.
How Is UK Income Tax Calculated?
Everyone gets a Personal Allowance of £12,570 tax-free. Income above that is taxed in three bands: 20% (the basic rate) on income between £12,570 and £50,270, 40% (the higher rate) on income between £50,270 and £125,140, and 45% (the additional rate) on income above £125,140. There is one important wrinkle: the Personal Allowance tapers away once your income exceeds £100,000 — you lose £1 of allowance for every £2 you earn above that figure, which creates an effective 60% marginal rate between £100,000 and £125,140. The calculator handles this taper automatically.
How Much Is UK National Insurance?
For 2026/27, employees pay Class 1 National Insurance at 8% on earnings between the Primary Threshold (£12,570) and the Upper Earnings Limit (£50,270), and 2% on earnings above the UEL. The Primary Threshold is aligned with the Personal Allowance, so the first £12,570 you earn is free of both income tax and NI. National Insurance rates have been cut several times in recent years — the calculator uses the current 8%/2% structure, but you should confirm the latest rate when you rely on the figure.
Should I Salary-Sacrifice My Pension Contributions?
Almost always yes. Salary sacrifice means you agree to a lower gross salary in exchange for your employer paying that amount directly into your pension. Because the sacrificed amount never appears as your salary, you do not pay income tax or National Insurance on it — and your employer often passes on their employer NI saving too. The calculator treats the percentage you enter as a salary-sacrifice deduction, which is the most common arrangement. If you are on a relief-at-source arrangement instead, your tax saving is similar but the NI saving does not apply.
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Disclaimer: Finance Atlas is not regulated by the FCA. Estimates only, not financial advice. Always consult a qualified, FCA-regulated adviser for your personal circumstances.