Salary Comparison Calculator
✓ Verified for 2026/27Compare Salaries
Salary Option A
Salary Option B
Option A
Option B
Difference
How We Calculated This
- Input base earnings: Start with gross salary (annual, monthly, weekly, or hourly wage rate).
- Deduct qualifying pre-tax items: Deduct workplace pension contributions (under net pay arrangements) and salary sacrifice schemes.
- Apply Personal Allowance: Apply the standard 2026/27 personal allowance of £12,570 (adjusted downward by £1 for every £2 when earnings exceed £100,000).
- Calculate progressive Income Tax: Compute tax at the basic rate (20%), higher rate (40%), and additional rate (45%) based on HMRC bands.
- Calculate employee National Insurance (NICs): Apply the Class 1 NI rate of 8% above the Primary Threshold (£12,570) up to the Upper Earnings Limit (£50,270), and 2% on remainder.
Real-World Examples
A typical UK salary calculation with no pension or student loan deductions.
Gross annual salary: £35,000 - Personal allowance: £12,570 = Taxable income: £22,430 Income tax (20% of £22,430): £4,486 National Insurance (8% on (£35,000 - £12,570)): £1,794.40 Total deductions: £6,280.40 Take-home pay: £28,719.60 per year
Calculation illustrating crossing into the 40% higher rate tax band.
Gross annual salary: £55,000 - Personal allowance: £12,570 = Taxable income: £42,430 Basic rate tax (20% of £37,700): £7,540 Higher rate tax (40% of (£42,430 - £37,700)): £1,892 National Insurance: - 8% on band (£50,270 - £12,570): £3,016 - 2% on band (£55,000 - £50,270): £94.60 Total deductions: £12,542.60 Take-home pay: £42,457.40 per year
Showing the 60% marginal tax rate area due to personal allowance taper.
Gross annual salary: £120,000 - Personal allowance reduction: (£120,000 - £100,000) / 2 = £10,000 = Remaining personal allowance: £2,570 = Taxable income: £117,430 Basic rate tax (20% of £37,700): £7,540 Higher rate tax (40% of (£117,430 - £37,700)): £31,892 National Insurance: - 8% on band (£50,270 - £12,570): £3,016 - 2% on band (£120,000 - £50,270): £1,394.60 Total deductions: £43,842.60 Take-home pay: £76,157.40 per year
Frequently Asked Questions
The standard UK personal allowance for 2026/27 is £12,570. You do not pay any income tax on earnings below this threshold unless your total income exceeds £100,000.
For every £2 you earn above £100,000, your personal allowance is reduced by £1. This means if you earn £125,140 or more, your personal allowance is reduced to zero.
For England, Wales, and Northern Ireland: the basic rate is 20% (on taxable income up to £37,700), the higher rate is 40% (on taxable income between £37,701 and £125,140), and the additional rate is 45% on income above £125,140.
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About This Calculator
This calculator uses the latest HMRC rates for the 2026/27 tax year. For illustrative purposes only — always consult a qualified tax adviser for formal advice.