Mustafa Bilgic
Mustafa Bilgic · Independent UK Calculator Operator · Reviewed

PAYE Calculator UK 2026/27 — Take-Home Pay After Tax & NI

Answer first: This free PAYE calculator (Pay As You Earn) is a PAYE tax calculator that works out your take-home pay after the income tax and National Insurance your employer deducts at source. Example for 2026/27: a £30,000 salary on tax code 1257L pays £3,486 income tax + £1,394.40 NI, leaving £25,119.60 take-home (about £2,093/month). PAYE is HMRC's system where your employer deducts income tax (20%/40%/45%) and employee NI (8%/2%) from each payslip before you are paid — the amount depends on your tax code, salary, pension contributions and student loan plan. Updated for the 2026/27 frozen thresholds (Personal Allowance £12,570).

Calculate your Pay As You Earn income tax, National Insurance and net take-home pay. Supports all tax codes and Scottish rates.

Last reviewed: June 2026 by Mustafa Bilgic, UK Calculator Editor

PAYE Tax Calculator 2026/27

Enter your gross salary and details to calculate PAYE deductions and take-home pay

Based on HMRC 2026/27 rates. For guidance only.

Enter your salary and click Calculate PAYE to see your payslip breakdown

What is PAYE (Pay As You Earn)?

PAYE — Pay As You Earn — is the system HM Revenue & Customs (HMRC) uses to collect Income Tax and National Insurance contributions (NICs) from employees in the United Kingdom. Rather than paying a lump-sum tax bill at the end of the year, employees have deductions taken directly from each payslip by their employer, who then pays HMRC on their behalf.

Introduced in 1944, PAYE is the primary method by which the UK government collects the vast majority of income tax. Approximately 84% of all UK income tax is collected via PAYE. If you are employed — as opposed to self-employed — you will almost certainly pay tax through PAYE.

Your employer uses your tax code (issued by HMRC) to determine how much of your pay is tax-free and how much tax to deduct at each pay period. The most common tax code for 2026/27 is 1257L, which gives you a tax-free personal allowance of £12,570 for the year.

How PAYE Works in Practice

  1. HMRC issues your tax code — based on your circumstances (personal allowance, benefits in kind, previous underpayments etc.)
  2. Your employer receives the code — either via the P6/P9 tax code notice, or the employee provides a P45 from a previous job
  3. Tax is deducted each pay period — using cumulative (standard) or week 1/month 1 (non-cumulative) basis
  4. Employer pays HMRC — on a monthly or quarterly basis, submitting a Full Payment Submission (FPS) via RTI (Real Time Information)
  5. Reconciliation at year end — HMRC issues P800 letters if you have paid too much or too little
Key PAYE Thresholds 2026/27: Personal Allowance £12,570 | Basic Rate 20% up to £50,270 | Higher Rate 40% up to £125,140 | Additional Rate 45% above £125,140 | NI Primary Threshold £12,570 | NI Upper Earnings Limit £50,270

2026/27 thresholds (checked June 2026): GOV.UK confirms these income tax and National Insurance thresholds are frozen and unchanged for the 2026/27 tax year (6 April 2026 to 5 April 2027) — the Personal Allowance stays at £12,570, basic rate 20% applies to £50,270, higher rate 40% to £125,140, additional rate 45% above £125,140, and employee National Insurance remains 8% between £12,570 and £50,270 then 2% above. Because they are frozen, these figures are identical to 2025/26, so results from this PAYE calculator on standard tax code 1257L apply equally to both years. Student loan repayment thresholds are uprated separately each April — check gov.uk for the current figures.

How PAYE Is Calculated: Step-by-Step (Worked Example £35,000)

Let us walk through the exact PAYE calculation for a UK employee earning £35,000 gross per year in 2026/27, with tax code 1257L, no student loan, and no pension contributions.

Step 1: Identify the Personal Allowance from tax code
Tax code 1257L → Personal Allowance = 1257 × £10 = £12,570
Step 2: Calculate Taxable Income
£35,000 (gross) − £12,570 (personal allowance) = £22,430 taxable income
Step 3: Apply Income Tax Bands
All £22,430 falls within the Basic Rate band (£0–£37,700 above personal allowance)
Income Tax = £22,430 × 20% = £4,486.00
Step 4: Calculate National Insurance
NI is charged on earnings between £12,570 and £50,270 = £22,430 at 8%
National Insurance = £22,430 × 8% = £1,794.40
Step 5: Calculate Take-Home Pay
£35,000 − £4,486 − £1,794.40 = £28,719.60 per year (£2,393.30/month)
Gross Annual Salary£35,000.00
Personal Allowance (tax-free, code 1257L)−£12,570.00
Taxable Income£22,430.00
Income Tax — Basic Rate 20% on £22,430−£4,486.00
National Insurance — 8% on £22,430 (£12,570–£50,270)−£1,794.40
Total Deductions−£6,280.40
Annual Take-Home Pay£28,719.60
Monthly Take-Home Pay£2,393.30
Effective Income Tax Rate12.82%
Effective Total Deduction Rate17.94%

PAYE Calculator — Frequently Asked Questions

What is PAYE and how does it work? +
PAYE (Pay As You Earn) is the UK's system for collecting income tax and National Insurance directly from employees' wages. Your employer uses your HMRC-issued tax code to calculate the correct deductions each pay period and pays the tax directly to HMRC on your behalf via Real Time Information (RTI). You receive your net pay after these deductions have been made. Most UK employees never need to file a tax return because PAYE handles everything automatically.
How is PAYE calculated? +
PAYE is calculated by: (1) Taking your gross pay for the period, (2) Applying your tax code to determine the tax-free portion, (3) Calculating income tax on the remaining taxable pay at the applicable rates (20%, 40%, or 45%), (4) Calculating National Insurance at 8% on earnings between £12,570 and £50,270, and 2% above £50,270 per year, (5) Deducting student loan repayments if applicable. For cumulative PAYE, all calculations account for amounts already paid since the start of the tax year (6 April).
What does tax code 1257L mean? +
1257L is the standard UK tax code for 2026/27. The number 1257, multiplied by 10, gives your annual tax-free Personal Allowance of £12,570. The letter L means you qualify for the standard Personal Allowance with no adjustments. This is the code used by most employees who have one job, no taxable benefits, no underpaid tax from previous years, and no other untaxed income. If your circumstances change, HMRC may issue a new tax code.
How do I check if I am paying the right amount of PAYE? +
Use this PAYE calculator to estimate your correct deductions, then compare with your payslip. Also check your tax code is correct — it appears on your payslip and P60. You can view and manage your tax code by logging into your Personal Tax Account at gov.uk/personal-tax-account. If your tax code is wrong, contact HMRC. At year end, HMRC automatically checks your tax and may issue a P800 if you have over or underpaid.
What is the PAYE threshold for 2026/27? +
For 2026/27, the PAYE starting threshold (Personal Allowance) is £12,570 per year — equivalent to £1,047.50 per month or £241.73 per week. You pay no income tax below this level. The National Insurance Primary Threshold is also aligned at £12,570 per year. NI is charged at 8% on earnings between £12,570 and £50,270 (Upper Earnings Limit), and at 2% above £50,270. The higher rate income tax threshold is £50,270, and the additional rate applies above £125,140.
Can I get a PAYE refund? +
Yes. Common reasons for PAYE overpayment include: starting work part-way through the tax year, being put on an emergency tax code (0T, BR), leaving employment before year end, claiming tax relief on job expenses, or paying too much NI. Cumulative PAYE automatically adjusts within the same tax year, so you may get a refund through your payslip. After the tax year ends, HMRC may issue a P800 tax calculation — if it shows a refund, you can claim online, by post, or HMRC may send a cheque. You typically have 4 years to claim a PAYE refund.
How does PAYE work if I have two jobs? +
Your Personal Allowance (£12,570 for 2026/27) is normally allocated to your main (primary) job. Your second job will usually receive tax code BR, meaning all earnings from the second job are taxed at 20% from the first pound. If you already pay higher rate tax in your main job and your second job income would also fall in the higher rate, your second job may be given a D0 code (40%). You can ask HMRC to split your Personal Allowance between both jobs by contacting them or updating your Personal Tax Account.
What is the difference between cumulative PAYE and week 1 / month 1 basis? +
Cumulative PAYE (the standard method) calculates your tax by reference to your total earnings and total allowances from 6 April to the current date. It automatically carries forward any unused allowances from earlier pay periods, which can result in tax refunds directly through your payslip. Week 1 / Month 1 basis (shown as W1 or M1 after your code, e.g. 1257L W1) calculates each period independently without reference to the past. No unused allowances are carried forward. It is used in emergency situations, for new starters without a P45, or when HMRC instructs a non-cumulative code.

Related Calculators

Salary Calculator

Take-home pay after tax

 Tax Calculator

Income tax breakdown

 NI Calculator

NI contributions breakdown

 Employer NI Calculator

Employer NI costs

Disclaimer: This calculator provides estimates for guidance only. Always verify with your payslip or GOV.UK Personal Tax Account. Source: GOV.UK Income Tax rates 2026/27.

Official Sources Used

UK

Mustafa Bilgic

This PAYE calculator is independently maintained by Mustafa Bilgic using official HMRC rates for 2026/27. About UK Calculator.

Official Data Source: All calculations use 2026/27 rates from HMRC Income Tax Rates | National Insurance Rates | Revenue Scotland. Always verify with official sources for important financial decisions.

Official Sources & References

Data verified against official UK government sources. Last checked April 2026.

Official UK Sources

Calculations follow the latest HMRC and gov.uk Income Tax / National Insurance guidance:

Last reviewed: June 2026 against HMRC/gov.uk 2026-27 rates.

📌 New: UK Golf Handicap Calculator (CONGU 2025/26) — quickly compute your handicap from recent rounds.

Quick answer: PAYE deductions 2026/27 take income tax (20–45%) and National Insurance (8% / 2%) directly from gross pay. On a £35,000 salary, monthly PAYE is approximately £406 (tax) + £190 (NI) = £596 total deductions.

Related UK Calculators

Salary by Profession

Payroll & Employer Tools

Related top calculators: Use the National Insurance Calculator for the NI portion of your monthly PAYE deductions.