Bonus Tax Calculator UK 2026-27
Calculate how much of your bonus you keep after income tax and National Insurance for 2026–27 using HMRC rates. Enter your salary and bonus amount to see the marginal tax rate on your bonus, including the personal allowance taper for incomes above £100,000. Supports England, Wales, Northern Ireland, and Scotland.
Rates correct for 2026–27 · Reviewed by the Richard Ross · Last updated April 2026
Receiving your bonus in April rather than March? The new tax year starts 6 April — timing a bonus payment can affect which year's allowances and thresholds apply. Check the income tax calculator for the relevant year.
Your bonus after tax
Net bonus (you keep)
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Total deductions
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Keep %
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Enter your salary and bonus above, then press calculate to see your results.
How bonuses are taxed in the UK
UK bonuses are treated as earnings for income tax and National Insurance purposes. They are not taxed at a special flat rate — instead, they are added to your other income for the year, meaning your bonus is taxed at your marginal income tax rate, the rate that applies to the top slice of your total income. This calculator works out the exact tax by calculating your total tax with and without the bonus, then showing the difference — the amount of tax attributable to the bonus itself.
How the calculation works
The calculator computes two tax calculations: one on your salary alone, and one on your salary plus bonus. The difference between the two results is the tax on your bonus. This approach correctly handles band-crossing — where part of a bonus is taxed at one rate and part at another — and the personal allowance taper. National Insurance is calculated the same way: the difference in NI between salary-only and salary-plus-bonus is the NI cost of the bonus.
Worked example: £45,000 salary with a £10,000 bonus
Tax on a £10,000 bonus (England/Wales, 2026–27):
Without bonus (£45,000):
- Income tax: £6,486
- Employee NI: £2,594.40
With bonus (£55,000):
- Income tax: £8,892
- Employee NI: £2,894.40
Tax on the £10,000 bonus: £2,406 income tax + £300 NI = £2,706
You keep: £7,294 of the £10,000 bonus (27.1% effective rate)
Note: £4,730 of the bonus crosses the higher rate threshold (£50,270), taxed at 40% instead of 20%. Use the take-home pay calculator for your full after-tax salary.
The marginal rate and why it matters
Your marginal rate is the rate applied to your last pound of income. If your salary of £40,000 puts you entirely in the basic rate band, but a £15,000 bonus takes your income to £55,000, the portion of the bonus above the higher rate threshold (£50,270) is taxed at 40% rather than 20%. The jump from 20% to 40% is why bonuses that cross a threshold feel disproportionately taxed — even though the rate structure is the same as salary.
The 60% tax trap on bonuses over £100,000
If your total income (salary plus bonus) exceeds £100,000, your personal allowance reduces by £1 for every £2 of income above that threshold, reaching zero at £125,140. This creates an effective marginal rate of 60% on income in the £100,000–£125,140 range — meaning a £10,000 bonus that falls entirely in this band costs you £6,000 in tax. Salary sacrifice into a pension is the most common mitigation: if you sacrifice the bonus into your pension, your adjusted net income drops back below £100,000 and the full personal allowance is restored. See our income tax calculator for the full taper effect.
Student loan deductions on a bonus
If you have a student loan, your bonus counts as income for repayment purposes. Student loan repayments are calculated at 9% (or 6% for postgraduate loans) on total earnings above your plan threshold. A bonus that pushes you above the threshold, or increases earnings already above it, will trigger additional repayment deductions on top of income tax and NI.
Contractors, IR35, and bonus income
If you operate through a limited company, you typically take salary plus dividends rather than a bonus. Whether your engagement falls inside or outside IR35 determines how your income is taxed — inside IR35, all contract income is treated as employment income subject to PAYE, income tax, and NI. Outside IR35, you can structure income more efficiently via dividends.
Scottish income tax on bonuses
Scottish taxpayers pay the same employee NI as the rest of the UK, but Scottish income tax rates and bands apply to the income portion of the bonus. Scotland has six tax bands compared to three in the rest of the UK, with the intermediate rate (21%) and advanced rate (45%) applicable at lower income thresholds than the corresponding higher and additional rates in England and Wales. A Scottish taxpayer receiving a bonus that crosses the higher rate threshold at £43,663 pays 42% on the excess — compared to 40% in England at £50,270. See our income tax calculator for full Scottish band details.
When this calculator does not apply
This calculator covers cash bonuses paid through PAYE. It does not cover share options, restricted stock units (RSUs), or benefits in kind — these have different tax treatment. If your bonus is paid in shares, the taxable value depends on the type of scheme (EMI, CSOP, unapproved) and the date of exercise or vesting. If you are self-employed, you do not receive bonuses through PAYE — your profit is taxed through Self Assessment.
Sources: HMRC — Income Tax rates and allowances (gov.uk), HMRC — National Insurance rates (gov.uk)
Frequently asked questions
Why is my bonus taxed more than my regular salary?
Your bonus is not technically taxed at a higher rate than equivalent salary — it is taxed at your marginal rate, the same rate that applies to the top slice of your regular pay. However, because your bonus sits on top of your salary, the entire bonus amount may fall in a higher tax band than most of your regular monthly pay. For example, if your salary puts you in the basic rate band but your bonus pushes your total income above £50,270, part of the bonus is taxed at 40%.
Can I reduce the tax on my bonus through salary sacrifice?
Yes — if your employer allows it, you can sacrifice some or all of your bonus into a pension via salary sacrifice. This removes the bonus amount from your taxable income and NI base, so you pay no income tax or NI on the sacrificed amount. The bonus goes into your pension instead of your bank account. This is particularly effective if the bonus pushes your income above a tax band threshold. Use our salary sacrifice calculator to model different contribution amounts.
Is my bonus subject to National Insurance?
Yes — bonuses are treated as earnings for NI purposes and are subject to Class 1 employee NI at the same marginal rates as regular pay. If your total earnings (salary plus bonus) exceed the upper earnings limit of £50,000, the NI rate above that threshold is 2% rather than 8%. The calculator shows the exact NI deduction on your bonus separately.
Does my bonus affect my personal allowance?
If your total income (salary plus bonus) exceeds £100,000, your personal allowance begins to taper at £1 for every £2 above that threshold. This creates an effective marginal rate of 60% on income between £100,000 and £125,140. The calculator accounts for this taper when calculating the income tax on your bonus.
How does HMRC tax a bonus paid in a lump sum versus spread across the year?
Through PAYE, your employer may apply the lump-sum bonus to a single month's payroll, which can temporarily push you into a higher band on a monthly basis. However, HMRC reconciles this at year end — you will not pay more tax overall than if the bonus had been spread evenly. If you were overtaxed during the year, HMRC will adjust your code or issue a refund.
How much tax will I pay on a £5,000 bonus in 2026-27?
It depends on your salary. If your salary is £30,000 (basic rate), the £5,000 bonus is taxed at 20% income tax (£1,000) plus 8% NI (£400), leaving you with £3,600. If your salary is £48,000, part of the bonus crosses the £50,270 higher rate threshold — the first £2,270 is taxed at 20% and the remaining £2,730 at 40%, plus NI at mixed rates.
What is the 60% tax trap on bonuses over £100,000?
If your salary plus bonus takes your total income above £100,000, you enter the personal allowance taper zone. For every £2 of income above £100,000, you lose £1 of personal allowance — creating an effective marginal rate of 60% on income between £100,000 and £125,140. A £10,000 bonus in this range costs £6,000 in tax. Pension salary sacrifice is the most common strategy to avoid this trap.
Is a bonus taxed differently from regular salary in the UK?
No — a bonus is taxed at exactly the same rates as regular salary. There is no special bonus tax rate in the UK. The reason bonuses often feel more heavily taxed is that they sit on top of your existing salary, so the entire bonus may fall in a higher tax band than your average salary rate. The annual tax calculation is identical whether income arrives as salary or as a bonus.
Does my bonus affect my student loan repayments?
Yes. Student loan repayments are calculated on total earnings, including bonuses. If your annual salary is below the repayment threshold but your bonus pushes you above it, you will owe student loan repayments on the excess. If you are already above the threshold, 9% (or 6% for postgraduate loans) is deducted from the bonus amount above the threshold.
How are bonuses taxed in Scotland for 2026-27?
Scottish taxpayers pay the same NI as the rest of the UK on bonuses, but Scottish income tax rates apply. Scotland has six bands: starter 19%, basic 20%, intermediate 21%, higher 42%, advanced 45%, and top 48%. A bonus that takes your income above the Scottish higher rate threshold of £43,663 is taxed at 42% on the excess — compared to 40% in England.
Related calculators
This calculator provides estimates only. Results are based on the 2026–27 tax year. Credibrate is not a tax adviser. For personalised advice speak to a qualified accountant.