Salary Calculator UK

Calculates your Take Home Salary, Income Tax and NI. Provides clear breakup of various salary components like Childcare vouchers, Salary Sacrifices, Pensions and Bonus.



Advanced options

How to use Salary Calculator

Quick Estimation:
For a quick estimation of your Take Home Salary, simply enter your yearly gross salary and hit Calculate.

Accurate Calculation:
If you need more accurate calculation of your Take Home, enter the Advanced Options(refer below) and calculate.


Advanced Options

Financial Year, Age:
Financial Year, Age and your Income determine your Personal Allowance and National Insurance. Personal allowance is deducted from your gross salary before tax is applied on your salary. Entering Financial Year and Age will provide a better estimate of your Take Home Salary. The below table depicts Personal Allowance for the financial year 2015/2016 based on your age.
Note: If your are aged above 65, you pay no NI.

Age in years Income Range Personal Allowance
Below 77 Does not matter 10,600
Above 77 Below 27,699 10,660
Above 77 27,699 to 27,819 10,660 - 10,600
Above 77 27,819 and above 10,600

Bonus
If you know your Bonus, you can enter it OR if you don't know your bonus, you can enter expected amount to get an estimate of you take home and taxes. Note that Bonus is treated as Salary so both Income Tax and NI applied on Bonus.

Employer Pension Contribution
This is the amount employer pays into your pension pot. This amount is not deducted from your salary but paid by your employer as benefit. Employer's pension contribution is tax and NI free. The calculator lets you enter this as a percentage of your salary as employers usually pay this a percentage of your salary.

Employee Pension Contribution
This is the amount deducted from your gross salary and paid into your pension pot. Income Tax and NI are not applied on this amount.The calculator lets you enter this as a percentage of your salary.

Child Care Vouchers
You can enter value of child care vouchers availed under in the Tab 'Salary Sacrifice'. Child care voucher is a form of salary sacrifice, your gross salary will be reduced by the value of child care voucher availed. If your employer offers child care vouchers, you can take advantage of the scheme to lower your tax bill. However, note that child care vouchers can lower the employer pension contribution as salary sacrifice will actually reduce your salary. The value of child care vouchers you can claim depends on your gross salary as show in the below table.

Salary Range Monthly Child Care Vouchers Eligibility
0 - 42,385 243
42,385 - 150,000 124
Above 150,000 110

Cycle to Work Scheme
This is also a form of salary sacrifice to save money on Tax and NI. It works like this, you decide how much you want to spend on the bicycle and related safety equipment(usually employers offer this upto an amount of 1000), employer gives you a voucher for that amount. You take the voucher to the approved retailer and pick your bike and related safety equipment like helmet, lights, etc and pay with the voucher. Note that you don't own the bike, your employer owns it and you lease it, at the end of the lease period(usually an year) your employer usually sell it to the employee( Usually for 5 or 10 !!). You are required to use the cycle for more than 50% of your journeys. You can enter value of cycle to work voucher availed under the Tab 'Salary Sacrifice'.



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Take Home Salary Calculation

The below steps explain how the Salary Calculator calculates your Take Home Salary, Income Tax and NI.

Step 1. Determine Taxable Income:
Your Taxable Income is obtained by deducting your personal allowance and deductions for your gross salary.

Taxable Income = Gross Salary - Personal Allowance - Deductions ( Child Care Vouchers, Salary Sacrifice, Employee Pension Contributions )

Step 2. Calculate Income Tax:
Income tax is calculated by applying the tax rates on your taxable income as below.

20% for the income between 0 - 32,000
40% for the income between 32,000 - 150,000
45% for the income above     150,000

Step 3. Calculate National Insurance:
National Insurance is calculated by applying the tax rates on your taxable with out deducting the personal allowance. This is because personal allowance is only applicable to Income Tax calculation. However you only pay NI for amount over 7,956

  0% for the income between 0 - 7,956
12% for the income between 7,957 - 41,860
  2% for the income above   41,860

Step 4. Take Home Salary Calculation:
Take home salary is calculating by deducting income tax, NI and other salary deductions.

Take Home Salary = Gross Salary - Income Tax - NI - Deductions ( Child Care Vouchers, Salary Sacrifice, Employee Pension Contribution )



 
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