Bonus tax calculator
A bonus isn't taxed at a special rate — it lands on top of your salary at your marginal rate, and the deductions can be startling. See exactly what you'll keep, with National Insurance worked out per pay period the way payroll actually does it.
Your pay
Where the bonus goes
How bonus tax works in 2026/27
The UK has no separate bonus tax rate, whatever the office rumour mill says. A bonus is ordinary pay that happens to arrive in one lump, and it's taxed at your marginal rate: the rate on your top slice of income, which is always uglier than the average rate spread across your whole salary. That gap between marginal and average is the entire reason bonuses feel savaged. One line covers the maths: bonus kept = bonus − income tax at your marginal rate − NI at your pay-period rate − student loan where a plan applies.
Worked example: £5,000 on top of £45,000
On a £45,000 salary a £5,000 bonus still fits inside the basic-rate band, so it loses £1,000 of income tax and £126 of NI, and £3,874 reaches you. A 23% haircut, annoying but civilised. Move the salary to £58,000 and the same £5,000 bonus is entirely higher-rate money: £2,000 of tax, £100 of NI, £2,900 kept. Notice the NI is small in both cases. Payroll assesses NI per pay period, and in a normal month your bonus mostly lands in the 2% zone above the weekly-equivalent threshold, which is why this calculator shows less NI than tools that crudely annualise. That's a genuine quirk of the rules, and it works in your favour.
The month itself can still look brutal on the payslip, because PAYE briefly taxes you as if you earned bonus-month money every month. The overcharge unwinds across the rest of the year on its own. No phone call to HMRC required, just patience.
When a bonus crosses a line
The painful bonuses are the ones that push you over a threshold: £50,270 into the higher band, £60,000 into Child Benefit clawback, £100,000 into the allowance taper where the effective rate hits 62%. The marginal rate calculator shows exactly which lines your bonus crosses. If the deduction offends you, ask payroll about bonus sacrifice before the payment date: the full £5,000 goes into your pension and the £1,126 of deductions in the first example simply never happens. The sacrifice optimiser prices it up, and the take-home pay calculator shows the year as a whole with the bonus folded in.
Common questions
How much tax will I pay on my bonus?
A bonus is taxed as ordinary income at your marginal rate — 20%, 40% or 45% — plus National Insurance and any student loan. There is no special “bonus tax”: a basic-rate earner typically keeps around 78–80% of a modest bonus, a higher-rate earner around 56–58%, and in the £100,000–£125,140 band the personal-allowance taper pushes the effective rate to roughly 62%.
Why does my bonus month payslip look so heavily taxed?
PAYE spreads your allowance and bands evenly across the year, so a one-off bonus is taxed in that month as if you earned it every month — sometimes clipping into a higher band temporarily. Cumulative PAYE corrects this over the following months, so by year-end the total matches the annual figures this calculator shows.
How is National Insurance worked out on a bonus?
Unlike income tax, NI is assessed per pay period and never re-averaged. That works in your favour: once your normal monthly pay plus bonus passes the monthly upper threshold (about £4,189), the rest of the bonus attracts NI at just 2% rather than 8%. This calculator uses the per-period method payroll actually applies — annualised calculators overstate the NI on large one-off bonuses.
Should I sacrifice my bonus into my pension?
If your employer offers bonus sacrifice, the full gross bonus goes into your pension with no income tax, NI or student loan taken — so the real cost of the pension boost is only the smaller net amount you would have received as cash. It is especially powerful in the £100k taper band, where keeping the cash means losing roughly 62p in each pound.
These results are estimates for general information only and are not financial advice. Your payslip depends on your tax code and how your employer runs payroll — check the real figures there. Read the full disclaimer.