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2026/27 calculator

Bonus tax calculator

Income tax on a bonus is charged at your top rate: 20%, 40% or 45%, or effectively 60% between £100,000 and £125,140. National Insurance and student loan are worked out on the bonus month alone, so the part of that month's pay above £4,189 only pays 2% NI. This calculator works it out the same way payroll does.

Enter your salary and bonus to see what reaches your bank account.

£/yr
£
%

Take-home pay

£4,063.47a month

£48,762 a year

Income tax
£14,832
National Insurance
£3,410
Effective rate
26.1%
Marginal rate
41%
Into your pension
£400/mo
Student loan
£0/mo

What a £10,000 bonus is worth

ScenarioTake-home a yearNet income, all sourcesIncome taxNational InsuranceInto pension
£40,000 salary, no bonus£32,322£32,322£5,486£2,194£0
£40,000 salary, £10,000 bonus£40,071£40,071£7,486£2,445£0
£95,000 salary, no bonus£65,662£65,662£25,432£3,910£0
£95,000 salary, £10,000 bonus£70,462£70,462£30,432£4,110£0
£95,000 salary, £10,000 bonus sacrificed into pension£65,662£65,662£25,432£3,910£10,000

Compare each pair to see what the bonus adds. In the last row the sacrificed amount goes into your pension, shown in the pension column.

How a bonus is taxed

Your employer adds the bonus to that month's pay. Income tax uses the cumulative PAYE system, so across the year the bonus is taxed at your marginal rate. If you are on an emergency code (W1, M1 or X), each month is taxed on its own and a bonus can be overtaxed until HMRC corrects your code.

National Insurance is worked out on each payday separately. In the bonus month, pay up to £4,189 is charged at 8% and anything above at 2%, so a large bonus often pays less NI than the same amount spread across the year.

Bonuses and the £100,000 limit

A bonus counts towards adjusted net income. If it takes you over £100,000, part of it will be taxed at an effective 60% and you may lose Tax-Free Childcare. Paying the part above £100,000 into your pension removes both problems.

Bonus sacrifice

Many employers let you sacrifice some or all of a bonus into your pension before it is paid. You avoid income tax and National Insurance on it, and your employer saves 15% NI, which some add to your pot. You must agree the sacrifice before the bonus is paid. From 6 April 2029, pension sacrifice above £2,000 a year will attract NI, so large bonus sacrifices will save income tax only.

Student loans and bonuses

Student loan repayments are also worked out per payday. A bonus month can produce a large deduction even if your yearly income is close to the threshold. If you overpay across the year, the Student Loans Company refunds the difference.

Common questions

How much tax will I pay on my bonus in 2026/27?

Income tax at your marginal rate: 20% up to £50,270, 40% up to £125,140 and 45% above, or effectively 60% between £100,000 and £125,140 where the Personal Allowance is withdrawn. National Insurance is 8% or 2% depending on that month's pay.

Why was my bonus taxed so much?

Usually because you are on an emergency tax code that taxes each month on its own, or because the bonus pushed you into a higher band. Under a normal cumulative code, the tax across the year matches your marginal rate.

Can I put my bonus into my pension?

Yes, if your employer offers bonus sacrifice. You must agree before the bonus is paid, and you save income tax and National Insurance on the amount sacrificed.

Is National Insurance on a bonus 8% or 2%?

Both can apply. In the bonus month, earnings up to £4,189 are charged at 8% and anything above that at 2%.

Does a bonus affect Child Benefit?

Yes. A bonus increases adjusted net income, so it can trigger or increase the High Income Child Benefit Charge once your income goes above £60,000.

Official sources

Every rate and threshold on this page is checked against these official pages. How we calculate

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