Going back to work, adding days or taking a pay rise can be worth far less than the headline once childcare and tax are netted off — and crossing £100,000 of income wipes out Tax-Free Childcare and your free hours overnight. Enter your before and after to see what you’d actually keep.
Models tax, National Insurance and student loan on the extra pay, the childcare you’ll pay, Tax-Free Childcare (20%, capped £2,000/child), and Child Benefit lost to the higher-income charge. Childcare schemes need both parents working (about 16 hrs/week at minimum wage) and neither over £100,000 of adjusted net income. Free funded hours (England, 9 months–4 years) vary by area — enter their yearly value to include the £100k loss. This is guidance, not financial advice.
It depends on your extra take-home pay set against childcare costs and any benefits or funded hours you lose. The calculator nets all of these off to show your true gain, which can be surprisingly small, or even negative, around the £100,000 mark.
Above £100,000 you lose your Personal Allowance and, in England, your funded childcare hours and Tax-Free Childcare. Together these can mean an extra pound of salary leaves you with very little once childcare is paid for.
The government adds £2 for every £8 you pay in, up to £2,000 per child a year (£4,000 if the child is disabled), as long as neither parent earns over £100,000. The calculator includes this top-up in your net position.
These results are estimates for general information only and are not financial advice. Check every figure yourself and seek appropriate advice from a qualified professional before making any decision. Read the full disclaimer.