Income Tax and National Insurance are calculated separately in the UK, both collected automatically through PAYE, and both use different rate structures worth knowing at a glance. Figures below are for the 2024/25 tax year. Calculate your exact take-home pay with the UK Take-Home Pay Calculator.
Income Tax Bands
| Band | Taxable Income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Basic Rate | £12,571 – £50,270 | 20% |
| Higher Rate | £50,271 – £125,140 | 40% |
| Additional Rate | Above £125,140 | 45% |
Personal Allowance Taper
| Income | Personal Allowance |
|---|---|
| Up to £100,000 | Full £12,570 |
| £100,000 – £125,140 | Reduces by £1 per £2 earned |
| £125,140+ | £0 |
National Insurance (Class 1, Employee)
| Band | Earnings | Rate |
|---|---|---|
| Below Primary Threshold | Up to £12,570 | 0% |
| Main Rate | £12,571 – £50,270 | 8% |
| Upper Rate | Above £50,270 | 2% |
Key Things to Know
- The £100,000–£125,140 band carries the highest effective marginal rate in the system — roughly 60% once the Personal Allowance taper compounds with the 40% higher rate, higher than the headline 45% additional rate above £125,140.
- National Insurance's rate falls, not rises, above £50,270 — 8% up to that point, then just 2% above it, the opposite of how Income Tax bands behave.
- Stamp Duty and ISA allowances are entirely separate systems from Income Tax and National Insurance — check the relevant reference or calculator for those independently rather than assuming these bands apply.
- These figures update at each government Budget. Confirm current thresholds before relying on them for a specific financial decision, particularly if you're close to a band boundary.