Income Tax Calculator 2026/27

Income Tax Calculator

✓ Verified for 2026/27

Your Income

£
%
Blind Person's Allowance Adds £3,070 to Personal Allowance
Take-Home Pay
£35,000
annual net salary
Income Tax
£5,000
effective rate
National Insurance
£2,000
employee NICs
Total Deductions
£10,000
total tax + NICs

Annual, Monthly & Weekly Breakdown

Gross Income £45,000
Pension Contrib. £2,250
Income Tax £5,000
National Insurance £2,000
Net Take-Home Pay £35,000
Net Pay 80%
Tax 10%
NI 10%
Period Gross Pension Tax NI Student Loan Take-Home
Year – – – – – –
Month – – – – – –
Week – – – – – –

How We Calculated This

  1. Input base earnings: Start with gross salary (annual, monthly, weekly, or hourly wage rate).
  2. Deduct qualifying pre-tax items: Deduct workplace pension contributions (under net pay arrangements) and salary sacrifice schemes.
  3. 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).
  4. Calculate progressive Income Tax: Compute tax at the basic rate (20%), higher rate (40%), and additional rate (45%) based on HMRC bands.
  5. 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

Example 1: Gross Salary of £35,000 (Standard Personal Allowance)

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
Example 2: Gross Salary of £55,000 (Higher Rate Threshold)

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
Example 3: Gross Salary of £120,000 (Tapered Personal Allowance)

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

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Frequently Asked Questions

What is the personal allowance for 2026/27?

The personal allowance is £12,570. You pay no income tax on earnings up to this amount. The allowance tapers by £1 for every £2 earned above £100,000, fully withdrawn at £125,140.

Do I pay National Insurance on pension contributions?

If your employer operates salary sacrifice, contributions are taken before NI is calculated — saving both income tax and NI. Personal contributions from net pay do not save NI.

What does my tax code mean?

The most common code is 1257L, representing the £12,570 personal allowance. An S prefix indicates Scottish rates apply.

What is the marginal tax rate?

Between £100,000 and £125,140 your personal allowance is withdrawn, creating a 60% effective marginal rate. Pension contributions or salary sacrifice can reduce income back below £100,000.