Income Tax and NI Combined Calculator
Our combined income tax and National Insurance calculator displays both major PAYE deductions on a single payslip-style breakdown for 2026/27. Most calculators show one or the other — this tool shows the complete picture: how much goes to income tax, how much to NI, how much your employer pays on top in employer NICs, and exactly what lands in your bank account.
Income Tax & National Insurance Calculator
See your full income tax and NI breakdown for 2026/27. Includes Scotland, pension and student loan.
Income Tax and NI Together: The Full Picture
For a salary of £40,000, the combined deductions in 2026/27 are: income tax of £5,486 and employee NI of £2,194 — a total PAYE deduction of £7,680, leaving take-home pay of £32,320 per year (£2,693 per month). But your true cost to your employer is higher still: employer NI at 15% on earnings above £5,000 adds a further £5,250, meaning the total employment cost is £45,250 for a £40,000 salary — or 13.1% more than the stated salary.
Understanding the employer cost is essential for salary negotiations, for business owners setting their own remuneration, and for freelancers pricing day rates that compare fairly with employment. A contractor charging £350 per day for 220 days earns £77,000 gross — but after self-employed NI and income tax, and after accounting for the lack of employer pension, holiday pay, and sick pay, the employed equivalent is closer to £55,000–£60,000.
The Effective Combined Tax Rate
Combining income tax and NI reveals the true marginal rates at different income levels. Between £12,570 and £50,270, the combined marginal rate is 28% (20% tax + 8% NI). Between £50,270 and £125,140, it is 42% (40% tax + 2% NI). For earnings between £100,000 and £125,140 where the Personal Allowance is withdrawn, the effective marginal rate reaches 62% (40% + 2% + 20% effective PA withdrawal). The average UK worker faces a combined marginal rate of 28p in every extra pound earned.
Frequently Asked Questions
Yes, in 2026/27 the Personal Allowance and the NI Primary Threshold are both aligned at £12,570 — a deliberate policy choice introduced in 2022. Previously the NI threshold was lower, meaning more NI was paid at lower income levels. The alignment means income tax and NI start at the same point.
It does not directly reduce your pay, but it affects total employment costs and therefore your employer’s willingness or ability to pay higher salaries. Some employer NI savings from salary sacrifice schemes are passed on to employees as enhanced employer pension contributions. Understanding the full cost helps in salary negotiations.
Salary sacrifice pension contributions reduce your gross salary before both income tax and NI are calculated — saving both simultaneously. A regular personal pension contribution gets income tax relief but not NI relief. This is why salary sacrifice is more efficient for pension saving. Our Salary Sacrifice Calculator quantifies the saving for any contribution level.
The most effective strategies are salary sacrifice pension contributions (saves both income tax and NI), cycle-to-work scheme participation (saves both on the cost of a bike), and making use of the ISA allowance (£20,000 per year) for tax-free savings growth. See our Take-Home Pay Calculator to model different income levels and deduction combinations.
No — they are calculated independently. NI does not reduce your income tax, and income tax does not affect your NI. However, salary sacrifice reduces the base figure on which both are calculated, which is why it is the single most efficient tool available to reduce both simultaneously.
This calculator provides the most detailed breakdown of your PAYE position. Enter gross salary, select your region, and add any adjustments to your personal allowance for non-standard tax codes, allowances, or reliefs. Pension contributions can be entered separately to show the effect on taxable income. The results include every significant deduction: income tax broken down by band, employee NI at both the main and upper rates, student loan repayments, and pension deduction. The effective tax rate combines all deductions as a percentage of gross. Use this for accurate comparison of job offers including pension terms — a role with a 5% employer pension contribution is materially better value than the headline salary difference alone.
Important Information
This calculator is provided for general information and planning purposes only. It does not constitute financial or tax advice and should not be relied upon as such. Figures are indicative estimates based on simplified, publicly available criteria and stated assumptions. Actual results depend on your full circumstances. See our Disclaimer for further information.