Take-Home Paycheck Calculator

Gross pay versus what arrives

The salary in your contract is the amount before anyone takes anything from it. What reaches your account is what remains after income tax, social contributions, pension deductions and whatever else your employer withholds — and the gap is frequently 20–40%. Planning a budget from the gross figure is the most common way to end up short every month.

The formula behind it

Net pay is gross − (gross × tax rate ÷ 100) − other deductions. Order matters here: on gross pay of 5,000 with 25% tax and 300 of other deductions, tax takes 1,250 and the remainder is 3,450. If your pension contribution is taken before tax, subtract it from gross first and enter the reduced figure, because pre-tax deductions lower the amount that is taxed at all.

How to use this calculator

Enter your gross pay for the period, your effective tax rate as a percentage, and the total of any other deductions such as insurance or retirement contributions. The result shows your take-home pay and the total withheld. Use your effective rate — total tax divided by total income — rather than your top bracket rate, which only applies to the last slice of your income.

Reading your payslip properly

Most tax systems are progressive, so your average rate is always lower than the rate on your highest band; a raise is never taxed at a rate that leaves you worse off. Pre-tax deductions such as pension contributions reduce taxable income, which means their true cost to you is less than their face value. Check your payslip against this calculation once a year — withholding errors are common and can run for months unnoticed.