UK Salary After‑Tax Calculator 2025 – PAYE, NI, and Student Loan

Introduction

This guide estimates 2025 UK take‑home pay with PAYE income tax, National Insurance, and optional student loan repayments by plan type.

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Inputs

• Gross salary and tax code assumptions
• NI category and student loan plan
• Pension contributions and benefits

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Output

• Income tax bands, NI contributions
• Student loan deductions and net pay

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Tips

• Salary sacrifice pension reduces NI and income tax
• Check thresholds for loan repayment start points
• Consider childcare and commuter tax reliefs where available

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Related Tools

• UK SDLT 2025: /calculator
• Take‑Home Pay 2025: /calculator
• Pay Frequency Converter: /calculator

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CTA: See Your UK Net Pay

Enter tax code and benefits to preview your 2025 UK take‑home pay breakdown.

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UK Payroll Basics: PAYE, NI, Pensions

Under PAYE, employers withhold income tax and National Insurance (NI) from salary. Tax codes reflect personal allowance adjustments and benefits in kind. Workplace pensions (auto‑enrolment) may use relief‑at‑source or net‑pay arrangements, changing how tax relief is applied on contributions.

Key points:

• NI categories determine contribution rates; thresholds and rates can change mid‑year.
• Student loan plans (1/2/4 or postgraduate) have distinct thresholds and rates; repayments are collected via payroll.
• Salary sacrifice for pension typically reduces NI and income tax base; verify scheme type.

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Methodology and Assumptions

1. Start from gross pay and apply PAYE tax bands and personal allowance rules.
2. Compute NI based on category and thresholds.
3. Add pension contributions and determine whether relief is applied via payroll or reclaim.
4. If student loan applies, calculate repayment based on plan thresholds.
5. Display net pay after tax, NI, pension, and loan deductions.

Assumptions:

• Exact 2025 thresholds should be verified; devolved income tax may apply in Scotland with different bands.
• Benefits in kind can change tax codes mid‑year—model approximate impact only.

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Examples (Illustrative Only)

Example A: Basic Rate Taxpayer with Auto‑Enrolment Pension

• Relief at source vs net‑pay method changes the payslip appearance; long‑term effect similar but cash flow differs.

Example B: Higher Rate with Salary Sacrifice

• Sacrifice increases pension funding and reduces NI/tax base; check annual allowance and tapering rules.

Example C: Graduate on Plan 2 + Postgraduate Loan

• Repayments start above plan thresholds; marginal net pay changes at those points—plan for cash flow.

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Optimization Ideas

• Use salary sacrifice for pension where offered to reduce NI.
• Track tax code changes tied to benefits; request corrections if codes are wrong.
• Consider ISA contributions for tax‑free growth alongside pension savings.

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FAQs

Q: Why did my tax code change mid‑year?
A: HMRC updates codes for benefits in kind or under/over‑payments from prior years; confirm P11D and notices.

Q: Scotland vs rest of UK?
A: Scotland has devolved income tax with different bands; NI is UK‑wide. Use Scotland‑specific bands when applicable.

Q: How does pension tax relief work?
A: Relief‑at‑source adds basic rate relief in the fund, with higher/additional relief claimed via return; net‑pay reduces taxable pay directly.

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Action Checklist (Copy/Paste)

• Confirm tax code and NI category
• Enter pension type (relief‑at‑source vs net‑pay)
• Apply PAYE bands, NI, and student loan plan
• Check for devolved bands if in Scotland
• Keep payslips and P60/P45 for records