Frequently Asked Questions
What is the income tax rate for 2025/26 in the UK?
UK income tax 2025/26 (England, Wales, NI): Personal allowance £12,570 (0%), Basic rate £12,571-£50,270 (20%), Higher rate £50,271-£125,140 (40%), Additional rate above £125,140 (45%). Scotland has different rates: Starter (19%), Basic (20%), Intermediate (21%), Higher (42%), Top (47%).
How much National Insurance do I pay in 2025/26?
Employee NI for 2025/26: 8% on earnings between £12,570 and £50,270 per year, then 2% on earnings above £50,270. The rate was reduced from 10% in January 2025 and again to 8% in April 2024. Employer NI rates are separate and paid by your employer.
What is the personal allowance for 2025/26?
The personal allowance is £12,570 for 2025/26 — the same as 2024/25 as it has been frozen until April 2028. This means you pay no income tax on the first £12,570 of earnings. It reduces by £1 for every £2 earned above £100,000, disappearing entirely at £125,140.
How does pension contribution affect take-home pay?
Most workplace pensions use salary sacrifice, meaning contributions reduce your taxable income. A 5% contribution on a £40,000 salary = £2,000/year reduction in taxable pay. You save 20% income tax (£400) + 8% NI (£160) = £560 in tax savings. Your pension pot receives the full £2,000, but your payslip deduction is only £1,440 net.
How do I calculate my monthly take-home from annual salary?
Annual take-home ÷ 12 = monthly take-home. Example: £35,000 gross salary → approximately £27,748 take-home after basic income tax and NI → £2,312/month. Use this calculator for the exact figure including your pension, student loan, and any other deductions.
What is the tax-free personal allowance for Scottish taxpayers?
Scottish taxpayers receive the same personal allowance of £12,570 — it's set by Westminster, not Holyrood. However, Scottish income tax rates and bands above the personal allowance differ. Scotland's 2025/26 rates: Starter 19% (£12,571-£14,876), Basic 20% (£14,877-£26,561), Intermediate 21% (£26,562-£43,662), Higher 42% (£43,663-£75,000), Top 47% (above £125,140).
How much student loan will I repay from my salary?
Plan 2 (most common): 9% of income above £27,295. On £35,000: (£35,000 - £27,295) × 9% = £693/year = £57.75/month. Plan 5 (post-2023 starters): 9% above £25,000, repaid for 40 years. Postgraduate Loan: 6% above £21,000. Repayments are income-contingent — you never repay more than you earn.
What is the marriage allowance and how does it affect take-home pay?
If one partner earns below the personal allowance (£12,570) and the other pays basic rate tax (20%), the lower earner can transfer £1,260 of their allowance. This saves the higher earner approximately £252/year in tax. Not available to higher/additional rate taxpayers. Apply via HMRC's Marriage Allowance service.