Home › How we calculate

How we calculate

Every figure on this site comes from one small file of HMRC rules for tax year 2026/27 and five arithmetic steps. The same code runs when the pages are built and when you type a salary into the calculator, so the two never disagree.

1. Sources

The rules are copied from GOV.UK and the Scottish Government on 2026-09-12 and stored with their source URLs. A script (scripts/fetch_hmrc.py) re-reads the gov.uk pages and confirms that every threshold still appears there; when HMRC changes a figure, the file is updated and the whole site is rebuilt. Nothing is scraped from third-party calculators.

1. GOV.UK: Income Tax rates and Personal Allowances (accessed 2026-09-12) ✓ checked
2. GOV.UK: Rates and thresholds for employers 2026 to 2027 (accessed 2026-09-12) ✓ checked
3. GOV.UK: Income Tax in Scotland (accessed 2026-09-12) ✓ checked
4. Scottish Government: Scottish Rate Resolution 2026-27, motion and explanatory note (accessed 2026-09-12) ✓ checked
5. GOV.UK: National Insurance rates and categories (accessed 2026-09-12) ✓ checked
6. GOV.UK: Repaying your student loan, what you pay (accessed 2026-09-12) ✓ checked

2. The five steps

1. Personal allowance. £12,570, reduced by £1 for every £2 of salary above £100,000, so nothing is left at £125,140.
2. Taxable income. Salary minus the allowance (minus any pension paid under a net pay arrangement).
3. Income tax. Taxable income is sliced into the bands of the chosen regime: 20% on the first £37,700, 40% up to £125,140 and 45% above for England, Wales and Northern Ireland; the six Scottish bands from 19% to 48% for Scotland. Each slice is multiplied by its rate.
4. Employee National Insurance. 8% of salary between the primary threshold (£12,570) and the upper earnings limit (£50,270), then 2% above, on the full salary and on an annual basis. Pension does not reduce NI unless paid by salary sacrifice, which we do not model.
5. Take-home pay. Salary minus income tax, National Insurance and any student loan repayment (9% or 6% of salary above the plan's threshold). Monthly is a twelfth, weekly a fifty-second, hourly assumes 37.5 hours for 52 weeks.

3. Worked example: £30,000

England: allowance £12,570, taxable £17,430. Tax at 20% is £3,486.00. NI is 8% of £17,430, £1,394.40. Take-home £30,000.00 − £3,486.00 − £1,394.40 = £25,119.60, or £2,093.30 a month.

Scotland, same salary: £3,967 at 19% (£753.73), £12,989 at 20% (£2,597.80) and £474 at 21% (£99.54) make £3,451.07 of tax. NI is unchanged, so take-home is £25,154.53, £34.93 more than in England.

£120,000 in England: the allowance shrinks to £2,570, taxable income is £117,430, tax is £37,700 × 20% + £79,730 × 40% = £39,432.00; NI is £37,700 × 8% + £69,730 × 2% = £4,410.60; take-home £76,157.40. These three cases are reproduced by hand in the repository's scripts/validate.py and the build stops if the engine ever disagrees.

4. Rounding

We calculate in pounds and pence without rounding and show pence in the payslip table; headline figures are rounded to the nearest pound. HMRC's PAYE tables round taxable pay down to the pound and work per pay period, so a real payslip can differ by a few pounds a year.

What the model does not know

• Your tax code. Anything other than 1257L (a company car, unpaid tax from last year, marriage allowance, a second job) changes the allowance.
• Pay-period effects: bonuses, overtime, starting or leaving mid-year, and monthly NI thresholds.
• Salary sacrifice pensions, which also reduce National Insurance, and employer pension contributions.
• Benefits in kind, childcare vouchers, the high income child benefit charge above £60,000, and the tapered annual allowance for pensions above £200,000.
• Self-employment (class 4 NI), dividends, savings interest, rental income and pension income.
• Scottish taxpayer status depends on where you live, not where you work.