UK Tax Calculator — Income Tax, NI & After Tax Pay 2025–26

How the UK Income Tax Calculator Works

This UK tax calculator takes your gross income from every source — employment, self-employment, rental property, savings interest, dividends, State Pension, and private pension — and applies the official 2025–26 HMRC thresholds in the correct statutory order. Non-savings income is calculated first, savings income is layered on top, and dividend income sits at the top of the stack. Each layer uses up band space, so the rate applied to your dividends reflects the full picture of everything you earn.

Use this income tax calculator to see your Personal Allowance, taxable income, tax by band, National Insurance, and net income — all at annual, monthly, and weekly periods. Results update in real time as you type.

Understanding Your After Tax Salary

Your after tax salary (also called take home pay or net pay) is everything left after Income Tax, National Insurance, and any other deductions. For a £35,000 salary in 2025–26 — with the standard 1257L tax code and no student loan — the after tax pay is approximately £28,000 per year, or around £2,333 per month.

Use this after tax calculator to model the impact of salary changes, pension contributions, bonus payments, or switching from employment to self-employment. Every input updates your net income instantly.

PAYE Calculator: Tax Deducted at Source Explained

Pay As You Earn (PAYE) is the system HMRC uses to collect Income Tax and NI directly from your employer before your salary reaches your bank account. This PAYE calculator mirrors what your employer's payroll software does: it applies your tax code to determine your effective Personal Allowance, calculates tax at 20% / 40% / 45%, and deducts Employee NI at 8% up to the Upper Earnings Limit and 2% above it.

Enter your tax code from your payslip or P60. The standard code for most employees is 1257L. If yours is different — for example because you have a company car benefit, owe tax from a previous year, or are transferring the Marriage Allowance — this calculator will adjust automatically.

Tax and NI Calculator: National Insurance Breakdown

National Insurance is separate from Income Tax and has its own thresholds and rates. This tax and NI calculator computes:

• Class 1 Employee NI — 8% on employment earnings between £12,570 and £50,270; 2% above. Stops at state pension age (66).
• Class 2 NI — flat rate for the self-employed (£3.45 per week in 2025–26) when profit exceeds the Small Profits Threshold.
• Class 4 NI — 9% on self-employment profits between the Lower and Upper Profits Limits; 2% above.

NI contributions fund the State Pension, NHS, and other benefits — they are not the same as Income Tax and cannot be offset against each other.

Net Pay Calculator: All Deductions in One Place

Unlike a simple salary calculator, this net pay calculator pulls together every deduction that affects your take home pay: Income Tax, National Insurance, pension contributions (salary sacrifice, relief at source, or net pay arrangement), Student Loan repayments, the High Income Child Benefit Charge, and Capital Gains Tax. The result is a single, accurate net income figure — not an approximation.

The internal link below leads to our salary calculator for your full PAYE breakdown if you want a more focused view of employment income only.

Dividend and Savings Tax Calculator

If you receive dividends — for example as a company director — the first £500 of dividend income is covered by the Dividend Allowance and is tax-free. Above that, dividends are taxed at:

• 8.75% if your total taxable income falls in the basic rate band
• 33.75% in the higher rate band
• 39.35% in the additional rate band

Savings interest benefits from the Personal Savings Allowance(£1,000 for basic rate taxpayers, £500 for higher rate taxpayers) and potentially the Starting Rate for Savings (£5,000 at 0% for low earners). Both are correctly applied in the order HMRC specifies.

Capital Gains Tax Calculator

Capital Gains Tax is charged on profits from selling assets such as shares, investment property, or a business. The Annual Exempt Amount for 2025–26 is £3,000 — no CGT is due on gains up to this amount. Above the exempt amount, the rates are:

• Shares and other assets: 18% (basic rate band) or 24% (higher / additional rate band) — post-October 2024 Budget rates
• Residential property: 18% or 24% — the same rates apply from 30 October 2024 onwards

Whether gains fall into the basic or higher rate band depends on how much of the basic rate band your other taxable income has already consumed. This calculator determines the split automatically.

Self Assessment Tax Calculator for the Self-Employed

Self-employed people pay Income Tax on profits via Self Assessment and also pay Class 2 and Class 4 NI. Unlike employed workers, tax and NI are not deducted at source — they are paid in January and July each year via payment on account.

Enter your self-employment profit after allowable business expenses. Tick the Trading Allowance if your gross income is close to £1,000. Add any losses brought forward from previous years. The calculator will show your full tax and NI liability alongside your employment income if you also have a job.

UK Income Tax Bands and Rates 2025–26

The UK income tax system uses a tiered band structure. You pay no tax on the first £12,570 (your Personal Allowance), then:

• Basic Rate (20%) — taxable income up to £37,700 (gross £12,571–£50,270)
• Higher Rate (40%) — taxable income from £37,701 to £112,570 (gross £50,271–£125,140)
• Additional Rate (45%) — taxable income above £112,570 (gross above £125,140)

These are the rates for England, Wales, and Northern Ireland. Scottish taxpayers pay different rates — see below.

The Personal Allowance Taper Above £100,000

If your adjusted net income (gross income minus pension contributions and Gift Aid donations) exceeds £100,000, your Personal Allowance reduces by £1 for every £2 above that level. At £125,140 the allowance is completely withdrawn, creating an effective marginal income tax rate of 60% on income between £100,000 and £125,140. Making pension contributions or Gift Aid donations is the most effective way to bring adjusted net income back below £100,000 and restore the allowance.

How Dividend Tax Works

Dividends received from UK and overseas companies benefit from the Dividend Allowance — £500 in 2025–26 — which sits on top of the Personal Allowance. Above the allowance, dividends are taxed at lower rates than equivalent salary income (8.75% vs 20% at basic rate, 33.75% vs 40% at higher rate) which is why many company owners pay themselves a combination of salary and dividends.

How Savings Interest is Taxed

If your non-savings income (salary, pension, rental income) is low enough, you may qualify for the Starting Rate for Savings — up to £5,000 of interest taxed at 0%. The allowance reduces by £1 for every £1 of non-savings income above your Personal Allowance, so most people with a full-time salary will not benefit. Above the Starting Rate (if applicable), the Personal Savings Allowance applies: £1,000 at 0% for basic rate taxpayers, £500 for higher rate taxpayers, and nothing for additional rate taxpayers.

Capital Gains Tax Explained

CGT applies when you sell or dispose of an asset that has increased in value. Each tax year you have a CGT Annual Exempt Amount (£3,000 in 2025–26) — gains up to this amount are tax-free. Above the exempt amount, the rate depends on your income tax band and the type of asset. Following the October 2024 Budget, the rates for shares and most other assets were increased to 18% and 24%.

National Insurance Classes Explained

There are four classes of NI relevant to individuals:

• Class 1 Employee NI — deducted via PAYE from employment earnings
• Class 2 NI — a flat weekly rate for self-employed people (builds State Pension entitlement)
• Class 4 NI — a percentage-based charge on self-employment profits
• Class 3 NI — voluntary contributions to fill gaps in your NI record (not calculated here)

How Gift Aid Affects Your Tax Bill

When you make a Gift Aid donation, the charity claims back 20% from HMRC — so a £80 donation is worth £100 to the charity. For you as a higher or additional rate taxpayer, Gift Aid also extends your basic rate band by the gross donation amount (£100 in this example), meaning more of your income is taxed at 20% rather than 40% or 45%. Claim the extra relief through Self Assessment — it can save higher rate taxpayers up to 20–25% of their gross donation value.

High Income Child Benefit Charge

If you or your partner receives Child Benefit and either person's adjusted net income exceeds £60,000 (in 2025–26), the High Income Child Benefit Charge (HICBC) begins to claw it back. At £80,000 the full amount is clawed back. The charge is calculated at 1% of Child Benefit received for every £200 of adjusted net income above £60,000. Pension contributions remain one of the most effective ways to reduce adjusted net income below the threshold.

Scottish Income Tax 2025–26

Scotland has its own Income Tax rates and bands, set by the Scottish Parliament. Scottish taxpayers pay:

• Starter Rate (19%) — £12,571 to £14,876
• Basic Rate (20%) — £14,877 to £26,561
• Intermediate Rate (21%) — £26,562 to £43,662
• Higher Rate (42%) — £43,663 to £75,000
• Advanced Rate (45%) — £75,001 to £125,140
• Top Rate (48%) — above £125,140

National Insurance rates are the same across all of the UK — HMRC collects NI, not Holyrood. Toggle “Scottish taxpayer” in the calculator to apply these rates.

How to Legally Reduce Your Tax Bill

The most effective legal methods to reduce your UK tax bill are:

• Pension contributions — salary sacrifice, relief at source, or net pay arrangement all reduce your Income Tax and, for salary sacrifice, your NI bill too. Contributing enough to bring adjusted net income below £100,000 restores the Personal Allowance, creating up to 60% effective tax relief.
• Gift Aid donations — extend your basic rate band and allow higher and additional rate taxpayers to reclaim the difference between the basic and their marginal rate.
• ISA allowance — shelter up to £20,000 per year in an ISA; interest, dividends, and gains inside an ISA are completely tax-free.
• Dividend strategy — if you are a company director, taking income as dividends (above the optimal salary level) is taxed at lower rates than salary.
• Marriage Allowance — if one partner earns below the Personal Allowance, they can transfer £1,260 to the higher earner, saving up to £252 per year.

For personalised tax advice, speak to a qualified accountant or tax adviser. Use our salary calculator to see your full PAYE breakdown if you want a focused view of employment income, salary sacrifice, and student loan repayments.