Take-Home Pay in the UK Explained (2025/26 Tax Year)
Understand exactly how much of your salary you actually keep after income tax, National Insurance, and other deductions. Includes current 2025/26 rates and worked examples.
Your gross salary and your take-home pay can look very different. A £40,000 salary does not mean £40,000 in your bank account each year. Once income tax, National Insurance, and pension contributions are deducted, the figure is considerably lower.
This guide walks through exactly how your pay is calculated in the 2025/26 tax year.
Use our Take-Home Pay Calculator to get your personalised net pay figure instantly.
The Main Deductions
When your employer pays you, several deductions come off before the money reaches you:
- Income Tax — charged by HMRC on your earnings above the personal allowance
- National Insurance (NI) — contributions that fund the state pension and NHS
- Pension contributions — if you are auto-enrolled in a workplace pension
- Student loan repayments — if applicable
Income Tax: 2025/26 Rates
| Income band | Tax rate |
|---|---|
| Up to £12,570 (personal allowance) | 0% |
| £12,571 to £50,270 | 20% (Basic Rate) |
| £50,271 to £125,140 | 40% (Higher Rate) |
| Over £125,140 | 45% (Additional Rate) |
Important: The personal allowance reduces by £1 for every £2 of income above £100,000. If you earn over £125,140, you receive no personal allowance at all.
National Insurance: 2025/26 Rates
Employee National Insurance contributions for 2025/26:
| Earnings | NI rate |
|---|---|
| Up to £12,570 (primary threshold) | 0% |
| £12,571 to £50,270 | 8% |
| Over £50,270 | 2% |
Worked Examples
£30,000 salary
- Taxable income: £30,000 − £12,570 = £17,430
- Income tax: 20% × £17,430 = £3,486
- NI: 8% × (£30,000 − £12,570) = 8% × £17,430 = £1,394
- Total deductions: £4,880
- Take-home pay: £25,120/year (£2,093/month)
£50,000 salary
- Taxable income: £50,000 − £12,570 = £37,430
- Income tax: 20% × £37,430 = £7,486
- NI: 8% × (£50,000 − £12,570) = 8% × £37,430 = £2,994
- Total deductions: £10,480
- Take-home pay: £39,520/year (£3,293/month)
£70,000 salary
- Income tax basic rate: 20% × £37,700 (£12,571 to £50,270) = £7,540
- Income tax higher rate: 40% × £19,730 (£50,271 to £70,000) = £7,892
- Total income tax: £15,432
- NI: 8% × £37,700 + 2% × £19,730 = £3,016 + £395 = £3,411
- Total deductions: £18,843
- Take-home pay: £51,157/year (£4,263/month)
Pension Contributions
If you are enrolled in a workplace pension, your employee contributions also reduce your net pay — but they also reduce your taxable income, so you get tax relief on them.
Auto-enrolment minimum contribution is 5% of qualifying earnings (between £6,240 and £50,270) from the employee, with the employer contributing at least 3%.
Pension contributions made through salary sacrifice reduce your income for both tax and NI purposes, making them particularly tax-efficient.
Student Loan Repayments
Student loan repayments are made through PAYE alongside tax and NI, calculated as a percentage of earnings above a threshold:
| Plan | Threshold | Rate |
|---|---|---|
| Plan 1 (pre-2012 England/Wales) | £24,990 | 9% |
| Plan 2 (post-2012 England/Wales) | £27,295 | 9% |
| Plan 4 (Scotland) | £31,395 | 9% |
| Postgraduate Loan | £21,000 | 6% |
How to Get Your Exact Take-Home Pay
The easiest way is to use our Take-Home Pay Calculator, which applies the current 2025/26 tax and NI rates and lets you add pension and student loan deductions.
For comparisons and salary negotiation, our Salary Calculator lets you convert between hourly, daily, weekly, and annual pay.