How much tax will I pay in 2026/27? The three PAYE deductions, the real thresholds, and worked take-home figures at £18k, £25k, £35k, £55k and £80k.
“How much tax will I pay” is one of those questions that sounds simple and gets answered badly. Someone tells you the rate is 20 per cent, you do the sum on your whole salary, and the number that arrives in your bank is nothing like it.
The reason is that nobody pays their headline rate on their whole salary. Three separate deductions come off PAYE pay, each with its own thresholds, and the combined effect is almost always lower than people expect at the bottom and higher than they expect at the top. Here is the actual arithmetic for 2026/27.
Income tax. Charged in slices. The first £12,570 is your personal allowance and is tax-free. From £12,570 to £50,270 you pay 20 per cent. From £50,270 to £125,140 you pay 40 per cent. Above £125,140 you pay 45 per cent.
National Insurance. Also charged in slices, but different ones and in the opposite direction. Nothing on the first £12,570. Then 8 per cent from £12,570 up to £50,270. Then just 2 per cent on everything above that. National Insurance gets lighter as you earn more, which is why high earners feel the 40 per cent band less than the headline suggests.
Pension. Only if you are enrolled, which most employees now are. The auto-enrolment minimum is 5 per cent from you and 3 per cent from your employer, calculated on qualifying earnings between £6,240 and £50,270 for 2026/27.
Student loan sits on top of all three if you have one, at 9 per cent above your plan threshold, or 6 per cent for a postgraduate loan.
All of these assume the standard 1257L tax code, one job, England, Wales or Northern Ireland, and no pension or student loan yet. Pension comes after.
| Salary | Income tax | National Insurance | Take-home | Per month | Effective rate |
|---|---|---|---|---|---|
| £18,000 | £1,086 | £434 | £16,480 | £1,373 | 8.4% |
| £25,000 | £2,486 | £994 | £21,520 | £1,793 | 13.9% |
| £35,000 | £4,486 | £1,794 | £28,720 | £2,393 | 17.9% |
| £55,000 | £9,432 | £3,111 | £42,457 | £3,538 | 22.8% |
| £80,000 | £19,432 | £3,611 | £56,957 | £4,746 | 28.8% |
The final column is the one worth sitting with. Someone on £35,000 who thinks of themselves as a “20 per cent taxpayer” is actually losing 17.9 per cent of their gross to tax and National Insurance combined. Someone on £80,000, firmly inside the 40 per cent band, loses 28.8 per cent overall.
Your marginal rate, the rate on your next pound, is not your effective rate, the rate on all your pounds. Almost every complaint about UK tax confuses the two.
Worth showing one in full, because the higher rate band is where the confusion concentrates.
Salary £55,000. Personal allowance £12,570, so taxable income is £42,430.
National Insurance:
Take-home: £55,000 − £9,432 − £3,111 = £42,457, or £3,538 a month.
Note the asymmetry. That top £4,730 slice pays 40 per cent income tax but only 2 per cent National Insurance, so its combined rate is 42 per cent. The slice below it pays 20 plus 8, so 28 per cent. The jump is real but it is 14 points, not 20.
If you want to run your own number rather than interpolate between rows, the take-home pay calculator does the whole thing including pension and student loan.
Take the £35,000 example. Qualifying earnings are £35,000 − £6,240 = £28,760, and 5 per cent of that is £1,438 a year, or £119.83 a month.
But it does not cost you £1,438. Under a net pay arrangement the contribution comes out before income tax is calculated, so you save 20 per cent of it:
Your employer adds £862.80 on top at 3 per cent. So £1,150 of your money becomes £2,301 in your pension. That is the single best-value deduction on a UK payslip, and the one people most often try to opt out of.
Your monthly take-home on £35,000 drops from £2,393 to about £2,273 once the pension is running.
Two places, and both catch people out.
Between £100,000 and £125,140. Your personal allowance is withdrawn at £1 for every £2 you earn above £100,000, so it is gone entirely by £125,140. You pay 40 per cent on the new earnings and 40 per cent on the allowance you are losing, which produces an effective marginal rate of 60 per cent across that stretch. A pay rise from £100,000 to £110,000 hands you about £4,000.
The Child Benefit charge, from £60,000. If you or your partner claim Child Benefit and your adjusted net income passes £60,000, you start paying it back at 1 per cent for every £200 over, and all of it is gone by £80,000. For a family with two children that is an effective marginal rate well above 40 per cent through those bands.
In both cases pension contributions are the standard fix, because they reduce the adjusted net income the calculations are based on.
One more thing that trips people up. The annual figures above assume a steady twelve months on the same code. Real payslips almost never behave that way.
If you start a job part way through the year, take unpaid leave, get a bonus, or sit on a week 1 or month 1 code for a few months, your monthly deduction will swing above and below the annual average. Under a cumulative code that is fine, because payroll recalculates your whole year to date position at every run and self-corrects. Under a non-cumulative code it does not, and the correction waits until after 5 April.
So if one month looks wrong, check the code before you check the maths. A 1257L that has quietly become 1257L M1 explains far more payslip queries than any arithmetic error does.
1257L, the personal allowance in every calculation above is different for you. Check it on gov.uk.S, the income tax bands above do not apply to you, though National Insurance does.Almost nothing moved, and that is the point. The personal allowance is still £12,570 and remains frozen. The higher rate threshold is still £50,270 and the additional rate still starts at £125,140. Employee National Insurance is still 8 per cent and 2 per cent.
Frozen thresholds are not the same as unchanged tax. Because the bands stay still while pay rises, more of your income drifts above each threshold every year. If you got a pay rise in April, a larger share of your salary is now in the 20 or 40 per cent band than last year, even though no rate changed. That is the whole mechanism behind rising effective rates, and it is why the middle column of that table creeps up quietly year after year.
Rather than working from a table, the NetPay app takes your actual code, hours, pension and student loan and shows your real take-home for the month. Free to download, and the calculator hub covers the specialist cases.
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NetPay does this maths for every shift, invoice and payslip, automatically.
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On £35,000 with the standard 1257L tax code, you pay £4,486 in income tax and £1,794 in National Insurance, so £6,280 in total. That leaves £28,720 a year, or about £2,393 a month, before any pension or student loan comes off. Your effective deduction rate is about 18 per cent, not 20.
Only on part of it. The 40 per cent rate applies to the slice of income above £50,270, not to your whole salary. On £55,000 that slice is £4,730, so you pay 40 per cent on that and 20 per cent on the band below it. Your overall deduction rate works out at roughly 23 per cent.
These figures cover income tax and National Insurance only. Most people also have a workplace pension, typically 5 per cent of qualifying earnings under auto-enrolment, and many have a student loan repayment at 9 per cent above their plan threshold. Both come off after the numbers shown here.
No. Scotland sets its own income tax rates and bands, and Scottish taxpayers have a tax code beginning with S. National Insurance is the same across the whole UK, and the personal allowance is the same, but the income tax bands differ, so the worked examples here apply to England, Wales and Northern Ireland.
Want to see your actual take-home pay?
NetPay UK works out your real net pay after tax, NI, pension and salary sacrifice, for hourly, shift and variable-income workers. Free to download.
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A note on financial advice: NetPay UK calculates take-home pay based on official HMRC tax rules. This article reflects rules in force at the time of publication (21 August 2026). Tax rules change. For complex situations, consult a qualified UK accountant or visit gov.uk/income-tax.
