Bonus Tax Calculator
See exactly how much of your bonus you keep after tax, National Insurance and student loan — and compare that against sacrificing part of it straight into your pension instead.
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How to use this calculator
Enter your salary and bonus, then see the real cash figure — and what changes if you sacrifice some of it into your pension.
Enter your salary and bonus
Your normal annual salary before the bonus, and the bonus amount itself.
Check the cash-in-hand figure
The headline number shows what actually lands in your bank account after tax, National Insurance and student loan.
Try a pension sacrifice
Move the sacrifice slider above 0% to see how much more of your bonus you’d keep in total by sending part of it straight into your pension instead.
Why it matters
Why bonuses are taxed so heavily
A bonus isn’t taxed at a special “bonus rate” — it’s simply added to your normal pay for that period and taxed at whatever rate applies to the top slice of your income for the year. If your salary already uses up your Personal Allowance and basic-rate band, a bonus on top is taxed at your marginal rate, not your average rate — often 28% (basic rate) or 42% (higher rate) once tax and National Insurance are combined, and it can be far higher if the bonus pushes you into the £100,000–£125,140 Personal Allowance taper zone, sometimes called the “60% trap”.
This is why a bonus can feel like it’s taxed more harshly than your regular salary — it isn’t a different rate, it’s just sitting on top of income you’re already earning.
The alternative
Bonus sacrifice: trading cash for pension
Many UK employers let you give up some or all of a bonus in exchange for an equivalent employer pension contribution — known as bonus sacrifice. Because the sacrificed amount never counts as your income, it avoids Income Tax and employee National Insurance entirely, so it goes into your pension pot at its full value instead of being reduced by tax and NI first. The trade-off is that the money is locked away in a pension until retirement age, rather than being available as cash now.
The comparison table below shows the difference in total value — cash kept plus pension value — at a few different sacrifice percentages, based on the salary and bonus you entered above.
| Sacrifice | Cash in hand | Goes to pension | Total value | Extra vs 0% sacrifice |
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Questions
Common questions
Is my bonus really taxed more than my salary?
No — there’s no separate “bonus tax rate” in the UK. Your bonus is simply added to your pay and taxed at whatever band(s) it falls into on top of your existing salary. It can feel higher because it’s taxed at your top marginal rate rather than your average rate across the whole year.
What is the 60% tax trap and can my bonus trigger it?
Between £100,000 and £125,140 of income, you lose £1 of Personal Allowance for every £2 you earn above £100,000. Combined with 40% tax and 2% National Insurance on that income, the effective marginal rate on earnings in this band is often quoted as roughly 60%. A bonus that pushes your total income into or through this band can be taxed much more heavily than the rest of your salary — this calculator flags it directly when it happens.
Does sacrificing my bonus into a pension actually save money?
Yes, in terms of tax and National Insurance — a sacrificed bonus avoids Income Tax and employee NI completely, so more of it reaches your pension pot than would reach your bank account as cash. The trade-off is access: pension money is generally locked away until you’re able to draw it, usually from your late 50s onward under current rules, so it isn’t a substitute for cash you need now.
Does this include employer National Insurance?
No — the figures above are from your perspective as the employee, covering Income Tax, employee National Insurance and student loan repayments. Employer National Insurance is a separate cost to your employer and doesn’t reduce your take-home pay directly, though some employers do pass on part of their NI saving from a sacrificed bonus as a further pension contribution — ask your employer or pension provider if that applies to you.
Does a one-off bonus change my tax code or future payslips?
Not permanently. A bonus is taxed in the pay period it’s paid in, based on your income for the year to that point. It doesn’t change your ongoing salary or tax code the way a permanent pay rise would — see our Pay Rise Calculator if you’re looking at a permanent increase instead of a one-off bonus.
Where these figures come from. Income tax, National Insurance and student loan rates are taken from gov.uk for the 2026/27 tax year, including the Personal Allowance taper between £100,000 and £125,140. All figures were checked on 23 September 2026.
Income Tax rates and Personal Allowances · National Insurance rates
How we calculate · Editorial policy. This is general information, not tax or financial advice.