The UK Salary Calculator

Yes — a bonus is treated as ordinary employment income and is subject to both Income Tax and National Insurance at the same marginal rates that apply to your salary. If your bonus pushes your total earnings from the basic rate band (below £50,270) into the higher rate band (above £50,270), the portion above £50,270 is taxed at 40% and NI at 2%. Your employer will usually deduct PAYE on a monthly or weekly basis, which can sometimes mean over-deduction in the short term. Any over-payment is automatically reconciled either through later payslips or your annual self-assessment.

Tax code BR (Basic Rate) means your entire income from that job is being taxed at 20% with no Personal Allowance applied. HMRC usually issues a BR code for a second job or a pension where your Personal Allowance has already been allocated to another source of income. If you only have one employer and you have a BR code, check with HMRC — you may be paying too much tax. You can update your tax code details at gov.uk/tax-codes or by calling HMRC on 0300 200 3300.

The Personal Allowance is the amount of income you can earn each tax year before you start paying Income Tax. For 2025/26 it is £12,570. Most UK residents qualify automatically and it is built into your tax code (1257L for the standard allowance). However, the allowance is tapered away for high earners: you lose £1 of allowance for every £2 of income above £100,000, meaning the allowance reaches zero at £125,140. In that £100k–£125,140 range you face an effective 60% marginal tax rate. UK non-residents and people with very high untaxed income may also have a different allowance.

Income Tax and National Insurance (NI) are both deductions from your pay, but they are calculated differently and fund different things. Income Tax is collected by HMRC and goes into general government spending. NI (specifically Class 1 employee contributions) builds your entitlement to the State Pension and certain benefits. In 2025/26, employee NI is charged at 8% on earnings between £12,570 and £50,270, and 2% on earnings above that — compared to Income Tax rates of 20%, 40% and 45%. The two are calculated independently, so you cannot use your Personal Allowance to reduce your NI bill.

Yes — pension contributions made via salary sacrifice or a relief-at-source scheme reduce your taxable income, which can lower both your Income Tax and NI liability. If you contribute £5,000 to a pension, your taxable pay falls by £5,000. A basic-rate taxpayer saves £1,000 in tax; a higher-rate taxpayer saves £2,000. If a pension contribution brings your income below £100,000, it can also restore some or all of your Personal Allowance, giving an effective 60% tax relief in that band. Use our Take-Home Pay Calculator to model pension contributions.

Yes. Scotland has its own Income Tax rates set by the Scottish Parliament. For 2025/26 there are six bands: Starter (19%), Basic (20%), Intermediate (21%), Higher (42%), Advanced (45%) and Top (48%). Scottish taxpayers earning above approximately £43,662 pay more Income Tax than equivalent earners in England, Wales or Northern Ireland. NI rates are the same across the UK. Toggle the Scotland option on any of our income tax calculators to see your Scottish take-home figure.

At £100,000 the Personal Allowance taper begins. For every £2 you earn above £100,000 you lose £1 of your £12,570 Personal Allowance. This creates an effective marginal Income Tax rate of 60% on earnings between £100,000 and £125,140 — far higher than the headline 45% additional rate. A common strategy to avoid this trap is to make pension contributions or Gift Aid donations to bring adjusted net income below £100,000. Our Required Salary Calculator can model this scenario.

Your tax code appears on your payslip, P60 and any HMRC letter. The standard code for 2025/26 is 1257L. If your code is different — for example BR, 0T, K followed by a number, or a Scottish S prefix — it means HMRC has adjusted your allowance for a reason such as unpaid tax from a previous year, a second job, or taxable benefits. Log into your Personal Tax Account at gov.uk to see your current code and the reasons behind it. Errors are common and can be corrected online or by phone.