Take-home pay

Where the money goes before you see it

Gross salary is a headline. Between it and your bank account sit three separate deductions that work in different ways, and confusing them is what makes payslips hard to read.

• Social insurance is usually a flat percentage, often with a ceiling above which no further contribution is taken. It is charged on your earnings, not on your taxable income, so deductions do not reduce it.
• Income tax is progressive. It applies to taxable income — gross minus the deductions the system allows — and each slice of that income is taxed at the rate of the band it falls into.
• Local tax is typically a flat rate applied to a taxable base that may be calculated slightly differently from the national one.

The bar above the breakdown shows all three against what you keep, at the same scale. For most salaries the surprise is how large the social insurance block is relative to income tax.

What take-home actually looks like

The table below is not an illustration — it is the calculator above, run at eight salary levels for a single filer taking the standard deduction. Federal figures only, so read the take-home column as a ceiling if your state taxes income.

Two things in that table are worth sitting with. The share you keep falls slowly and smoothly — from roughly 86% at $40,000 to about 72% at $300,000 — nothing like the cliff the bracket percentages suggest. And the marginal rate does not rise monotonically: it peaks just below the social security wage base, drops sharply above it, and only climbs again higher up.

Working backwards: the salary behind a take-home figure

Budgets are written in take-home money. Rent, a mortgage payment and savings goals all come out of what reaches your account, while job offers and salary surveys quote gross. Turning one into the other by guessing a tax percentage is where most people go wrong, because the share withheld changes with the very salary you are trying to find.

Choose Take-home → gross above and enter the monthly figure you need. The calculator searches for the smallest gross salary whose take-home reaches it, then shows the full breakdown at that salary, exactly as the forward calculation does. Here is that search run for six common monthly targets, single filer, federal only.

Read down the last column and the reason a flat rule of thumb fails becomes clear. Doubling your take-home target from $5,000 to $10,000 a month more than doubles the salary you need, because every extra dollar is taxed at the marginal rate, not the average one. If you are negotiating toward a take-home number, convert it to gross here first and negotiate on that figure — then allow for your state's income tax on top, since it is not in these numbers.

A search is used instead of a formula because take-home is not always a smooth function of salary. In Japan's system the basic deduction shrinks in steps as income rises, so just past each step take-home briefly falls. A formula that assumes more gross always means more net would overshoot there; the search finds the lower salary that already reaches the target.

Take-home pay in the UK

Choose UK above to use the 2026/27 rates for England, Wales and Northern Ireland. Two deductions come out of every payslip. Income tax is charged at 20%, 40% and 45% on income above the £12,570 Personal Allowance. National Insurance is charged at 8% on earnings between £12,570 and £50,270, then 2% on everything above. Scotland sets its own income tax bands, so Scottish taxpayers will see a different figure.

The marginal rate column has one row that stands out. Between £100,000 and £125,140 the Personal Allowance is withdrawn at £1 for every £2 earned, so each extra pound both lands in the 40% band and pulls another 50p of allowance into it. That works out to 60% income tax plus 2% National Insurance: a £10,000 raise from £100,000 to £110,000 leaves only about £3,800 in your account. Salary sacrifice into a pension is the usual way out of that band, and it is the one case where the gross figure you negotiate matters less than how it is paid.

Working back from a monthly figure follows the same pattern as in the US tables. These are the gross salaries needed for common take-home targets:

How progressive brackets actually work

A bracket is not a category your whole salary falls into. It is a slice. If the first band is 10% up to 11,925 and the next is 12%, then someone with 20,000 of taxable income pays 10% on the first 11,925 and 12% only on the 8,075 above it — never 12% on the whole amount.

This is why the effective rate is always lower than the top bracket you touch. Someone in the 22% band typically pays an effective income tax rate closer to 12–14%. Both numbers are shown above, and they answer different questions: the effective rate tells you what this year cost, the marginal rate tells you what next year's raise is worth.

The ceiling effect

Social insurance ceilings produce a result that looks wrong until you understand it: the marginal rate can fall as income rises. In the US system, once earnings pass the social security wage base, that 6.2% stops applying to additional income. Someone earning 200,000 keeps more of their next dollar than someone earning 150,000, despite being in a higher income tax bracket.

Rather than hard-code that rule, this calculator finds the marginal rate by recomputing your net pay at a slightly higher salary and measuring the difference. That approach is exact for any system, including ones like Japan's where a higher gross does not translate into an equally higher taxable income because the employment income deduction absorbs part of the increase.

What a raise is actually worth

Marginal rates are quoted as percentages, but nobody spends a percentage. Here is the same $5,000 raise at each salary level, with the part that reaches your account and the part that does not.

Notice the row at $150,000 against the one at $200,000. The higher earner keeps more of the same raise, because they have already passed the wage base and stopped paying social security on additional income. This is also the answer to a question worth asking before negotiating: a raise offered as a percentage of gross is worth materially less than the same percentage of take-home, and the gap widens the more you earn.

What is not included

Every calculator of this kind draws a boundary somewhere. This one draws it at the national level plus one local rate, and states exactly what it used in the assumptions panel. Not included:

• State, provincial, or municipal taxes beyond the single local rate shown
• Pension or retirement contributions you choose to make
• Employer-provided health premiums deducted at source
• Tax credits, dependants, and itemised deductions
• Bonuses taxed at a different withholding rate

Any of these can move your real take-home by several percent. The point of showing every rate used is so you can see precisely which assumption to correct, rather than being handed a number with no working attached.

Using this sensibly

This is a planning estimate, not a tax return. It is well suited to comparing two job offers, seeing what a raise is really worth after the marginal rate, or sanity-checking a payslip you find confusing. It is not suited to filing anything, and it has no knowledge of your personal circumstances. For that, use your country's official calculator or an accountant.