Work out employee take-home pay and employer cost for 2025/26 and 2026/27, including PAYE income tax, Class 1 National Insurance, workplace pension contributions and student loans.
Start with an annual salary, then optionally add the tax code, Scottish rates and payslip details that apply to the employee.
Take-home pay is gross salary less PAYE Income Tax, employee National Insurance and any pension or student loan deductions. Their tax code, Scottish tax status and other payslip settings can change the result, so the salary offer alone does not tell you what reaches their bank account.
For 2026/27, standard employer National Insurance is 15% on pay above £5,000 a year, although the employee’s NI category can change this. Add employer pension contributions and other hiring costs to your budget; do not deduct employer NI from the employee’s take-home pay.
Eligible employers can offset up to £10,500 against employer Class 1 National Insurance in either supported year. A company whose only employee liable for employer NI is its sole director cannot claim; check eligibility separately rather than treating the gross employer NI estimate as your final bill.
Employee contributions reduce the cash paid to the employee, while employer contributions add to your employment costs. The tax treatment depends on whether the scheme uses relief at source, net pay or salary sacrifice, so match the settings to your actual scheme.
PAYE can depend on earlier pay, a changed tax code, bonuses or whether payroll uses a cumulative or non-cumulative basis. Monthly estimates here are annual averages, so check actual payroll before promising an exact monthly take-home amount.