How much of a pay rise you keep in 2026/27
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A pay rise is taxed at your top rate, not your average rate. The extra money sits on top of what you already earn, so it meets the highest tax band you have reached. That is why you keep a smaller share of a rise than you keep of your salary as a whole.
What comes off each extra pound
These are the rates for England, Wales and Northern Ireland, with income tax and NI together.
- £12,570 to £50,270: 20% tax and 8% NI. You keep 72p.
- £50,270 to £100,000: 40% tax and 2% NI. You keep 58p.
- £100,000 to £125,140: you also lose £1 of personal allowance for every £2, which makes the tax 60%. You keep 38p.
- Above £125,140: 45% tax and 2% NI. You keep 53p.
A student loan takes a further 9% above your plan's threshold, and a Postgraduate Loan 6%.
How your pension changes the sums
- Salary sacrifice: you give up part of your salary and your employer pays it into your pension. Tax, NI and student loan are all worked out on the lower salary.
- Net pay: your contribution is taken before income tax, so you pay less tax. NI and student loan are still worked out on your full salary.
- Relief at source: your contribution is taken after tax. Your pension provider claims 20% from HMRC and adds it to your pot. Your payslip does not change, and if you pay tax above 20% you claim the rest yourself.
All three reduce your adjusted net income. That is the figure HMRC uses for the £100,000 personal allowance taper and the £60,000 Child Benefit charge. With relief at source the allowance comes back when you claim, not in your monthly pay.
A salary sacrifice cannot take your pay below the minimum wage. The government has also announced that from 6 April 2029, NI will be charged on pension salary sacrifice above £2,000 a year. Income tax relief is not changing, and nothing changes for 2026/27.
Worked examples
These assume no student loan and no pension unless they say so.
£45,000 to £55,000, across £50,270
The first £5,270 of the rise is taxed at 20% with 8% NI. The other £4,730 is over the limit, so it is taxed at 40% with 2% NI. Tax takes £2,946 and NI £516. You keep £6,538, which is 65.4% of the rise.
£95,000 to £105,000, across £100,000
The whole £10,000 is taxed at 40%, which is £4,000. You also lose £2,500 of personal allowance, which costs another £1,000. NI takes £200. You keep £4,800, which is 48% of the rise.
The same rise with 5% salary sacrifice
Your adjusted net income after the rise is £99,750, under £100,000, so no allowance is lost. Tax takes £3,800 and NI £190. Another £500 goes into your pension. You keep £5,510, which is 55.1% of the rise.
£29,000 to £31,000 on Plan 2
The rise takes you over the Plan 2 threshold of £29,385, so repayments start at £12 a month, or £144 a year. Tax takes £400 and NI £160. You keep £1,296, which is 64.8% of the rise.
Common questions
Can a pay rise leave me with less take-home pay?
Not from income tax, NI and student loan. Each takes only part of the extra money, never all of it. The exception to watch is Child Benefit. If you or your partner get it, you pay back 1% for every £200 of income over £60,000, and all of it over £80,000. This calculator does not include that.
Why do I keep so little between £100,000 and £125,140?
Because the personal allowance is withdrawn in that range. Each extra £2 is taxed at 40% and also makes another £1 of your income taxable at 40%.
Do pension contributions change which thresholds I cross?
Yes. They reduce your adjusted net income, so a rise that would take your salary over £100,000 or £60,000 may not take your adjusted net income over it. This is general information, not advice on what you should do.
Is this different in Scotland?
Yes. Scotland has its own income tax bands, so the shares above do not apply. NI and student loan rules are the same. This calculator does not cover Scottish rates.
Where these figures come from
See gov.uk for income tax rates, tax relief on pension contributions, adjusted net income, salary sacrifice, the salary sacrifice change from April 2029 and the High Income Child Benefit Charge.