UK Take-Home Pay Explained
Understand how your gross salary becomes take-home pay through Income Tax and National Insurance — including the different Income Tax bands that apply in Scotland.
What is take-home pay?
Your gross salary is your pay before deductions. Your take-home pay, sometimes called net pay, is what remains after deductions from your pay have been made.
For many UK employees, two of the largest statutory deductions are Income Tax through PAYE and employee Class 1 National Insurance. Your actual payslip can also include pension contributions, student loan repayments, salary sacrifice and other deductions.
UK tax years do not follow the calendar year. The figures in this guide relate specifically to the 2026/27 tax year.
England, Wales and Northern Ireland tax bands
For 2026/27, the standard Personal Allowance is £12,570. This is the amount of income a person can generally receive before paying Income Tax, although the allowance can be reduced in some circumstances.
For employment income in England, Wales and Northern Ireland, the main 2026/27 bands for someone receiving the standard Personal Allowance are:
| Band | Income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Basic rate | £12,571 – £50,270 | 20% |
| Higher rate | £50,271 – £125,140 | 40% |
| Additional rate | Over £125,140 | 45% |
These are marginal tax bands. Moving into a higher band does not mean your entire salary is taxed at that higher rate. Only the portion falling within that band is taxed at its applicable rate.
For example, someone earning £60,000 with the standard Personal Allowance does not pay 40% on the whole £60,000. The allowance and lower tax band are applied before the portion falling into the higher rate is taxed.
Scotland uses different Income Tax bands
If you are a Scottish taxpayer, different rates and bands apply to employment income, pensions and most other non-savings, non-dividend taxable income. National Insurance remains a UK-wide system.
With the standard £12,570 Personal Allowance, the 2026/27 Scottish bands are:
| Band | Income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Starter rate | £12,571 – £16,537 | 19% |
| Basic rate | £16,538 – £29,526 | 20% |
| Intermediate rate | £29,527 – £43,662 | 21% |
| Higher rate | £43,663 – £75,000 | 42% |
| Advanced rate | £75,001 – £125,140 | 45% |
| Top rate | Over £125,140 | 48% |
Several Scottish thresholds and rates differ, so salary comparisons should use the correct tax system for where the taxpayer lives.
How employee National Insurance works
Most employees pay Class 1 National Insurance. Unlike Income Tax, NI is calculated using earnings periods such as weekly or monthly pay periods.
For most employees in the standard category during 2026/27:
| Monthly pay band | Employee NI rate |
|---|---|
| Up to £1,048 | 0% |
| £1,048.01 – £4,189 | 8% |
| Over £4,189 | 2% |
Your employer also normally pays employer National Insurance, but that is a separate employer cost and is not normally deducted from your stated gross salary.
What could different salaries look like?
These simplified annual examples show Income Tax and employee NI before pension contributions, student loans or other deductions. NI is shown using an annualised approximation of the standard employee thresholds, so an actual payslip can differ slightly because NI is normally calculated by pay period.
England, Wales & Northern Ireland
How Scotland compares
Because Scottish Income Tax bands differ, the Income Tax result can be different even when gross salary and employee National Insurance are otherwise the same.
*NI examples use annualised standard Category A-style thresholds for illustration. Payroll NI is normally assessed by earnings period, so exact deductions can differ.
What happens to the Personal Allowance above £100,000?
The standard Personal Allowance does not simply remain at £12,570 for every salary. It is reduced by £1 for every £2 of adjusted net income above £100,000.
The Personal Allowance taper
As adjusted net income rises through this range, more income becomes taxable because the Personal Allowance is being withdrawn.
This is why simply applying the headline tax bands to gross salary can give an inaccurate result for higher earners. Pension contributions, Gift Aid and other factors can also affect adjusted net income, so individual circumstances matter.
Why might your payslip differ from a calculator?
A salary calculator is useful for estimating take-home pay, but a real payroll calculation can include information that a basic gross-salary example does not know about.
Where these figures come from
Tax information can change between tax years, so CalcNest uses official UK government information as the primary reference for the rates and thresholds in this guide.
Primary sources
HM Revenue & Customs / GOV.UK: Income Tax rates and Personal Allowances for the 2026/27 tax year.
HM Revenue & Customs / GOV.UK: Scottish Income Tax rates and bands for 2026/27.
HM Revenue & Customs / GOV.UK: Class 1 National Insurance rates and thresholds for employees for 6 April 2026 to 5 April 2027.
Figures checked for this guide in October 2026. For an important personal tax decision, confirm the current rules on GOV.UK or with an appropriately qualified professional.
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This guide provides general information and illustrative calculations, not personal tax or financial advice. Tax treatment depends on individual circumstances and can change. The worked examples exclude pension contributions, student loans and other individual deductions unless stated.