Saving Tool Advanced
Saving Tool Advanced is now available!
Income Tax Calculator
Use the Saving Tool UK income tax calculator to find out the Income Tax, National Insurance contributions and Student Loan repayments on your salary in the 2024/25 tax year. See your take-home pay by year, month or week.
See below for a full breakdown of the tax you will pay. Add more information such as your workplace pension and student loan repayments for a more detailed picture of your finances.
Your taxes (2024/25)
| Year | Month | Week | |
|---|---|---|---|
| Gross Income | £28,500 | £2,375 | £548 |
| Pension Contributions | £0 | £0 | £0 |
| Employer Pension Contributions | £0 | £0 | £0 |
| Taxable Income | £28,500 | £2,375 | £548 |
| Personal allowance | £12,570 | - | - |
| National Insurance | £1,273 | £106 | £24 |
| Income Tax | £3,186 | £266 | £61 |
| Take Home Pay | £24,041 | £2,003 | £462 |
Your Monthly Outgoings
Projected Pension
Wealth & Financial Independence More Info
- In today's money, you'll have at least £17,472 / year (£1,456 / month) when you retire at 66 - just from your savings
- In real terms (where inflation is not removed), that's £31,013 / year (£2,584 / month)
- That means all your outgoings are covered without having to make any further contributions!
- All your expenses are covered for your retirement, but your wealth may start to decrease towards old age
Projected Wealth
- FI Target = Annual outgoings (£17,472) * Years needed for 4.00% SWR (25.00) = £436,800
- Invested annual pension = £0
- Invested annual surplus = £2,201
- Inflation of 2.5% / year
- Assumes New State Pension, payments increasing with inflation (2.5% / year)
- Assumes student loans last 30 years max
- Assumes a flex-drawdown pension for illustration purposes
- Assumes you draw down pension up to the higher rate bracket (£50,270), then draw down your S&S ISA
- Pension lump sums are not included
How to Use Saving Tool UK
Determining your take-home pay can seem daunting, but it's simpler than you might think. Saving Tool UK helps UK taxpayers calculate their net income after tax, National Insurance (NI), and other deductions such as pension contributions and student loan repayments. Here's how to use it and what key elements you need to understand.
Step 1: Enter Your Income
Your Salary is your total income before any deductions. This is the amount typically stated in your employment contract. For example, if your salary is £40,000 per year, enter this amount into the calculator. Also, if you have other known income such as a bonus, add this into Other Income
Step 2: Select Your Tax Region
Income tax rates and bands differ depending on whether you live in England, Wales, Northern Ireland, or Scotland. Make sure to select the correct region to get an accurate calculation of your take-home pay.
Step 3: Consider Any Other Adjustments
In addition to your salary, several factors can impact your take-home pay, including:
- Student loan repayments: If you're repaying a student loan, it will be deducted once you earn over a certain threshold
- Pension contributions: Both employer and employee pension contributions can reduce your taxable income. It's important to include any contributions you're making, whether they're to a workplace pension, personal pension, or Self-Invested Personal Pension (SIPP)
- Benefits in kind: Taxable benefits, such as a company car or private health insurance, should also be considered when calculating your tax liabilities
Step 4: View Your Results
The take-home pay calculator will give you a yearly, monthly and weekly breakdown of your take-home pay, plus the taxes that will be paid over the course of the year. Also, you'll see a pension projection and wealth projection, based on your expenditure and pension inputs.
Step 5: Go Even Further
Is your situation more complex? Want to specify upcoming large expenses, windfalls, add a partner, specify old pensions and more? Go to the next stage with Saving Tool Advanced.
Key Deductions Explained
Personal Allowance
The personal allowance is the amount of income you can earn each year before paying income tax. For the 2024/25 tax year, the personal allowance is set at £12,570. However, it gradually reduces for individuals earning over £100,000, and those earning more than £125,140 have no personal allowance.
Income Tax Bands in England, Wales, and Northern Ireland (2024/25)
| Band | Taxable Income | Tax Rate | Maximum Amount |
|---|---|---|---|
| Personal Allowance | £0 - £12,570 | 0% | 0 |
| Basic Rate | £12,571 - £50,270 | 20% | £7,540 |
| Higher Rate | £50,271 - £125,140 | 40% | £29,948 |
| Additional Rate | Over £125,140 | 45% | N/A |
Income Tax Bands in Scotland (2024/25)
| Band | Taxable Income | Tax Rate | Maximum Amount |
|---|---|---|---|
| Personal Allowance | £0 - £12,570 | 0% | 0 |
| Starter Rate | £12,571 - £14,876 | 19% | £438 |
| Basic Rate | £14,877 - £25,561 | 20% | £2,137 |
| Intermediate Rate | £25,562 - £43,662 | 21% | £3,801 |
| Higher Rate | £43,663 - £125,140 | 42% | £34,220 |
| Top Rate | Over £125,140 | 47% | N/A |
National Insurance Contributions (2024/25)
National Insurance (NI) is a key contribution that UK workers make to fund various social welfare programs, including the state pension, NHS, and other public services. The amount you pay depends on your earnings, and the rates vary depending on income bands.
NI is deducted directly from your salary, and both employees and employers are required to make contributions. While employees contribute based on their salary, employers also pay a separate amount, which does not affect your take-home pay.
If you're self-employed, you'll pay a different type of National Insurance (Class 2 and Class 4), which is calculated based on your profits rather than your salary.
Your National Insurance contributions build up qualifying years, which determine your eligibility for the full state pension. For most people, 35 qualifying years are needed to receive the full amount.
National Insurance contributions are not paid on income from a pension (private pension or state pension).
The current National Insurance rates are as follows:
| Income Band | NI Rate for Employees (Class 1, Category A) |
|---|---|
| £0 - £12,570 | 0% |
| £12,571 - £50,270 | 8% |
| Over £50,270 | 2% |
Other Deductions
Student Loan Repayments
If you're repaying a student loan, your repayments will depend on which plan you are on:
| Plan Type | Threshold (2024/25) | Repayment Rate |
|---|---|---|
| Plan 1 | £24,990 | 9% over the threshold |
| Plan 2 | £27,295 | 9% over the threshold |
| Plan 4 | £31,395 | 9% over the threshold |
| Plan 5 | £25,000 | 9% over the threshold |
| Postgraduate Loan | £21,000 | 6% over the threshold |
Pension Contributions
Pension contributions, whether to a workplace pension, private pension, or Self-Invested Personal Pension (SIPP), reduce your taxable income. The annual pension allowance for the 2024/25 tax year is £60,000. Contributions exceeding this limit may incur additional tax.
Types of Pensions
There are 2 main types of pensions for UK taxpayers to consider.
- Defined Contribution Pension: Your pension pot is based on how much you and your employer contribute. The final amount depends on investment performance.
- Defined Benefit Pension: Your pension is typically based on your salary and length of service with the employer. It promises a fixed, guaranteed income for retirement.
Make sure to understand how much you need in retirement when considering your financial plans.
Gift Aid
Donations to charity through the Gift Aid scheme can also reduce your tax bill. Gift Aid allows charities to claim 25p on every £1 donated, and higher or additional rate taxpayers can claim back the difference between their tax rate and the basic rate on their donation.
Tax Codes
Your tax code tells your employer how much tax to deduct from your salary. Most people in the UK have a tax code of 1257L, which means they're entitled to the full personal allowance of £12,570. If your tax code is different, it could be due to untaxed income, taxable benefits, or adjustments from a previous tax year.
| Tax Code | Meaning |
|---|---|
| 1257L | Standard tax code with full personal allowance (£12,570) |
| K*** | You have income that is not being taxed another way and it's worth more than your tax-free allowance. |
| 0T | Your Personal Allowance has been used up, or you've started a new job and your employer does not have the details they need to give you a tax code |
| BR | All income taxed at basic rate (20%) |
| D0 | All income taxed at higher rate (40%) |
| D1 | All income taxed at additional rate (45%) |
| NT | You pay no tax on this income |
For the full list of UK tax codes including Scottish and Welsh codes, see the full list on gov.uk.
FAQ
What is Saving Tool UK?
Saving Tool UK is an online salary calculator tool that calculates your take-home pay by considering your gross salary and deducting tax, National Insurance, pension contributions, and other factors like student loans.
What is Saving Tool Advanced?
Saving Tool Advanced is a more sophisticated version of Saving Tool UK that allows you to enter much more information and get much more detailed results. For more information, visit the Saving Tool Advanced FAQ.
How do I calculate my take-home pay?
Simply enter your gross salary into the calculator and include any adjustments like pension contributions or student loan repayments. The calculator will do the rest.
Why does Scotland have different tax rates?
Income Tax in Scotland is controlled by the Scottish Government instead of the UK government, so it can set it's own rates (except for personal allowance). Currently, Scotland has twice as many bands, meaning residents pay slightly different rates of tax.
Why do different tax calculator tools sometimes output different numbers?
Calculating taxes on income is a complex area and there can be differences between tools, particularly given that HMRC rates and thresholds can regularly change over time (for example, the UK government cut employee National Insurance Contributions on two occasions in 2023/24, outside of the usual schedule). Rates, rules and guidance need to be carefully followed in order to match HMRC's own calculations accurately (including number precision and rounding). Saving Tool UK uses verified and audited calculations that match HMRC calculations.
What's the difference between gross pay and net pay?
Gross pay is your total income before any deductions, while net pay (or take-home pay) is what remains after income tax, National Insurance, and other deductions.
What if I have a second job?
If you have more than one job, your personal allowance may be split between them. The second job may be taxed at the basic rate (20%) or higher rate (40%) if your personal allowance is already fully used in your primary job. When using Saving Tool UK, it's easiest to supply your total combined income as 1 'salary', since the result will be the same.
How do student loans affect my take-home pay?
Once you earn above the repayment threshold for your student loan plan, repayments will be automatically deducted from your salary. The amount you repay depends on your earnings and plan type. Student loan repayments can have a significant impact, particularly to higher earners, so it's important to specify this when using Saving Tool UK.
Can my pension really get that large?
Many people are often surprised by how Saving Tool UK tells them their pension could get. The answer is yes - thanks to the opportunity that low-cost index funds provide, and the impact of long-term compounding returns, pensions are a vital tool for financial planning