So what actually lands in the bank?

Why the number in your contract is never the number you get

Four things come off a UK salary before it reaches you, and they come off in an order that matters. Your pension goes first, which lowers the pay the taxman then looks at. Income tax and National Insurance are worked out on what is left, each against its own set of thresholds. A student loan repayment, if you have one, is taken as a slice of everything you earn above your plan's threshold.

The calculator applies the 2026-27 rates in that order, so the answer matches a real payslip rather than a rough percentage. Nothing you type leaves the browser.

Worth knowing before you budget

• Your first payslip in a new job is often wrong, and usually in your favour later. An emergency tax code sorts itself out once HMRC catches up.
• A pay rise never leaves you worse off. Only the pounds above a threshold are taxed at the higher rate, not the whole salary.
• Overtime in one month can look brutally taxed. PAYE assumes every month looks like this one, then corrects itself.
• Raising your pension by a percent or two costs your take-home far less than it adds to the pot, because the contribution comes out before tax.

What the bands are for 2026-27

Income tax is charged in slices. You only pay the higher rate on the part of your salary that sits inside the higher band.

National Insurance

Employees pay 8% on earnings between £12,570 and £50,270, then 2% on everything above that. It is deducted on each pay packet rather than annually, which is why a month with a bonus in it looks so different from the one before.

Reading the deductions line by line

Gross pay

The contract figure, divided by twelve. Nothing has been taken off it yet.

Pension

Taken before tax is worked out, so a £1,500 contribution on a £30,000 salary reduces the pay you are taxed on to £28,500. At the basic rate that contribution costs you about £1,200 of take-home for £1,500 in the pot.

Student loan

Nine per cent of everything above your plan's threshold, taken whether or not the balance will ever be cleared. Plan 1 starts at £26,900, Plan 2 at £29,385, Plan 4 at £33,795 in Scotland, and Plan 5 at £25,000 for anyone who started after August 2023.

Net pay

What is left. This is the figure to budget against, and the one to compare when you are weighing up two jobs.

Questions people ask

Why was my first payslip so small?

Starting mid-month means a part month's pay. If your P45 has not reached the new employer you will also be on an emergency code, which usually over-deducts and then refunds itself within a couple of months.

What does my tax code mean?

It tells your employer how much you can earn before tax starts. 1257L is the standard one for 2026-27 and gives you the full £12,570 allowance. A code starting BR means every pound is taxed at 20%, which is normal on a second job.

Can I legally keep more of it?

Pension contributions are the largest lever for most people, because the money goes in before tax. Salary sacrifice schemes for cycles and childcare work the same way. Marriage allowance is worth claiming if your partner does not use their full personal allowance.

I have two jobs. What happens?

Your personal allowance is applied to one job, usually the main one. The second is typically taxed at the basic rate from the first pound. If the split is wrong you are paying too much, and HMRC will move the allowance if you ask.

Is overtime taxed more heavily?

No, but it can look that way. PAYE works out each month as if you earned that much every month, so a big month is taxed as though it were your new normal and evens out afterwards.