How much of a pay rise do you actually keep?

It depends on the rate the rise is taxed at. A basic-rate earner keeps about 72% (after 20% tax and 8% NI); a higher-rate earner keeps about 58%; and between £100,000 and £125,140 you keep only about 38% because the Personal Allowance is withdrawn.

Why did my pay rise barely change my take-home?

A rise can push part of your pay into a higher band, or into the £100k taper, so more of it is taxed. Crossing £50,270 (40%), £100,000 (60% effective) or a student-loan threshold all reduce what you keep.

Does a pay rise beat inflation?

Only if your take-home grows faster than prices. We show the real-terms value so you can see whether the rise is a genuine increase or just keeping pace with the cost of living.

Pay rise calculator 2026/27

A pay rise is taxed at your top rate, so you never keep all of it. Put in your current and new salary to see the real, after-tax value of the raise — and whether it beats inflation.

Current salary

New salary

I live in Scotland

England, Wales & NI, 2026/27. Excludes pension and student loan — for those, use the main calculator.

Your pay rise

2026/27

Gross rise: £5,000
Extra tax & NI: −£1,400

You keep

of your £5,000 rise

£3,600

You keep 72% of this rise — the rest is tax and National Insurance.

Verified · 2026/27
21 June 2026

Effective rate —

Marginal rate — on your next £1

What it's worth in real terms

Your salary has the spending power of — in 2025 money — the pound has lost — since then. A rise of — would just keep pace.

Inflation: ONS Consumer Prices Index, latest May 2026.

How this was calculated

For the 2026/27 tax year (England, Wales & Northern Ireland) we apply your tax-free Personal Allowance, the Income Tax bands, employee National Insurance, and any student-loan repayment — each traced to a dated gov.uk/HMRC source. A pension contribution comes off before Income Tax (and before National Insurance too, for salary sacrifice). Over £100,000 the Personal Allowance tapers away, which is why the marginal rate jumps to about 60%.

The full method and every source is on our methodology page.

Built & maintained by the Pay Packet team · methodology sourced from HMRC · last reviewed 21 June 2026. About our figures →

Why you don't keep all of a pay rise

Every extra pound is taxed at your marginal rate — the rate on your top slice of pay. A basic-rate earner loses 20% to tax and 8% to National Insurance, keeping about 72p in the pound. Cross £50,270 and the rise is taxed at 40%; a student loan takes another 9%.

The worst place for a rise is between £100,000 and £125,140, where your Personal Allowance is withdrawn — so a rise there is effectively taxed at 60% (62% with NI), and you keep less than 40p in the pound. A salary-sacrifice pension can sidestep this; the £100k trap calculator shows how.

Finally, a rise only makes you better off in real terms if your take-home grows faster than prices — the figure above shows what your new salary is worth against recent years.

Pay rise questions

How much of a pay rise do you actually keep?: It depends on the rate the rise is taxed at. A basic-rate earner keeps about 72% (after 20% tax and 8% NI); a higher-rate earner keeps about 58%; and between £100,000 and £125,140 you keep only about 38% because the Personal Allowance is withdrawn.
Why did my pay rise barely change my take-home?: A rise can push part of your pay into a higher band, or into the £100k taper, so more of it is taxed. Crossing £50,270 (40%), £100,000 (60% effective) or a student-loan threshold all reduce what you keep.
Does a pay rise beat inflation?: Only if your take-home grows faster than prices. We show the real-terms value so you can see whether the rise is a genuine increase or just keeping pace with the cost of living.