UK Bonus Tax Calculator
Calculate how much tax and National Insurance you will pay on your bonus for the 2025/26 or 2024/25 tax year. Enter your annual salary and bonus amount to see the full breakdown of deductions and your take-home bonus.
Key Takeaway
There is no special “bonus tax” in the UK. Bonuses are taxed at your marginal income tax rate and are subject to National Insurance — but employer withholding may temporarily over-deduct.
Key Facts — 2025-26
Bonus Tax Rate
Marginal rate
NI on Bonuses
8% / 2%
Personal Allowance
£12,570
Allowance Taper Starts
£100,000
Net Bonus
£3,600.00
Take-home amount
Total Deductions
£1,400.00
Effective rate: 28.00%
Marginal Rate
28.00%
Combined IT + NI
| Deduction | Amount |
|---|---|
| Income Tax on Bonus | £1,000.00 |
| National Insurance (Class 1) | £400.00 |
| Total Deductions | £1,400.00 |
| Net Bonus (Take-Home) | £3,600.00 |
How Bonus Tax Works in the UK
Bonuses in the UK are taxed as part of your regular income. HMRC does not apply a separate “bonus tax” — instead, your bonus is added to your salary and the combined total determines which tax bands apply. The incremental tax on the bonus is the difference between the tax on your salary alone and the tax on your salary plus bonus. This means the bonus is effectively taxed at your marginal rate.
Many people feel bonuses are taxed more heavily than their regular pay. This is usually because of employer withholding. When payroll processes a bonus in a single pay period, the software may annualise the payment — treating it as though you earn that amount every month. This pushes the calculated annual income into a higher tax band, resulting in more tax being deducted upfront. The cumulative PAYE system corrects this over subsequent pay periods, or you can claim a refund after the tax year ends.
National Insurance Class 1 applies to bonuses just as it does to regular earnings. For 2025-26, employee NIC is 8% on earnings between £12,570 and £50,270, and 2% on earnings above £50,270. Your bonus is combined with your salary for the pay period to determine the NIC due. Employer NIC is also charged on the bonus at 15%.
Scottish taxpayers pay Scottish income tax rates on their bonus, which differ from the rates in England, Wales, and Northern Ireland. Scotland has six income tax bands ranging from 19% to 48%, compared to three bands (20%, 40%, 45%) in the rest of the UK. National Insurance rates, however, are the same across the whole UK.
For high earners, a bonus can trigger the Personal Allowance taper. If your total income (salary plus bonus) exceeds £100,000, the Personal Allowance of £12,570 is reduced by £1 for every £2 above £100,000, disappearing entirely at £125,140. This creates an effective marginal rate of 60% in the taper zone — 40% income tax plus an extra 20% from losing the allowance. A bonus that pushes you into this range will cost significantly more in tax than the headline rate suggests.
UK Tax Bracket Reference — 2025-26
Your bonus is taxed at the marginal rate determined by your total income (salary + bonus). The Personal Allowance is £12,570 and tapers for income above £100,000.
England, Wales & Northern Ireland
| Band | Rate |
|---|---|
| Up to £12,570 | 0% (Personal Allowance) |
| £12,571 – £50,270 | 20% |
| £50,271 – £125,140 | 40% |
| Over £125,140 | 45% |
Scotland
| Band | Rate |
|---|---|
| £12,571 – £14,876 | 19% |
| £14,877 – £26,561 | 20% |
| £26,562 – £43,662 | 21% |
| £43,663 – £75,000 | 42% |
| £75,001 – £125,140 | 45% |
| Over £125,140 | 48% |
Net bonus at a glance — Scotland vs England
What you actually take home from a bonus on a £50,000 base salary for 2025-26. Scotland’s 42% higher rate (vs 40% in England / Wales / NI) and 48% top rate (vs 45%) mean the gap widens sharply as the bonus grows. National Insurance is identical across the UK.
Bonus of £1,000
Bonus of £5,000
Bonus of £10,000
Bonus of £25,000
Bonus of £50,000
Bonus of £100,000
Change salary, region or bonus size using the calculator above for your own figures. Values rounded to the nearest pound; effective rate includes income tax + National Insurance on the bonus only.
Worked Example
Scenario: You earn £50,000 per year in England and receive a £10,000 bonus. You want to know how much of that bonus you will actually take home.
Step 1 — Tax on salary alone: On a £50,000 salary, you use your £12,570 Personal Allowance and pay 20% basic rate on the remaining £37,430. Income tax on salary: £7,486.
Step 2 — Tax on salary + bonus: Your total income is £60,000. Tax is calculated as: 20% on £37,700 (from £12,571 to £50,270) = £7,540, plus 40% on £9,730 (from £50,271 to £60,000) = £3,892. Total income tax: £11,432.
Step 3 — Tax on the bonus: The difference is £11,432 − £7,486 = £3,946 income tax on the bonus. This reflects £270 of basic rate band remaining (£50,270 − £50,000 = £270 at 20%) and £9,730 taxed at 40%.
Step 4 — National Insurance on the bonus: Your salary already exceeds the £50,270 upper earnings limit, so the entire bonus is subject to NIC at the 2% rate. NI on bonus: £10,000 × 2% = £200.
Total deductions on bonus: £3,946 + £200 = £4,146.
Net bonus: £10,000 − £4,146 = £5,854.
Your effective tax rate on the bonus is 41.5%.
Frequently asked questions
Is there a special bonus tax rate in the UK?
No. There is no separate “bonus tax” in the UK. Bonuses are treated as regular income and taxed at your marginal income tax rate. HMRC adds the bonus to your salary and calculates tax on the combined total. The incremental tax on the bonus depends on which tax band the bonus falls into after your salary.
Why was so much tax deducted from my bonus?
When your employer pays a bonus, payroll software may annualise the payment for that pay period, treating it as though you earn that amount every month. This can push the calculated annual income into a higher tax band, resulting in more tax being deducted upfront. The cumulative PAYE system corrects overpayments in subsequent pay periods, or you can claim a refund from HMRC after the tax year ends.
Do I pay National Insurance on my bonus?
Yes. Employee Class 1 National Insurance is charged on bonus payments. For 2025-26, the rate is 8% on earnings between £12,570 and £50,270, and 2% on earnings above £50,270. Your bonus is combined with your salary for the pay period to determine the NIC due. Your employer also pays employer NIC at 15% on the bonus.
Can I salary sacrifice my bonus into a pension?
Yes, if your employer offers a salary sacrifice arrangement. By redirecting your bonus into your pension before tax and National Insurance are deducted, you reduce your taxable income and NIC liability. The contribution counts toward your annual pension allowance (£60,000 for 2025-26). This is particularly valuable for higher-rate taxpayers. Speak to your employer about whether their scheme permits bonus sacrifice.
How are bonuses taxed in Scotland?
Scottish taxpayers pay Scottish income tax rates on their bonus, which differ from the rest of the UK. Scotland has six income tax bands (19%, 20%, 21%, 42%, 45%, 48%) compared to three in England/Wales/NI (20%, 40%, 45%). National Insurance rates are the same across the whole UK. The tax on your bonus depends on which Scottish band it falls into after your salary.
Will I get a tax refund on my bonus?
You may receive a refund if your employer over-deducted tax from your bonus. The cumulative PAYE system adjusts throughout the tax year, so overpayments are often corrected in subsequent pay periods. If you have overpaid by the end of the tax year, you can claim a refund from HMRC by writing to them, calling, or using your Personal Tax Account online.
Does my bonus affect my Personal Allowance?
Yes. If your salary plus bonus exceeds £100,000, your Personal Allowance (£12,570) starts to reduce by £1 for every £2 over £100,000. It is fully removed at £125,140. This creates an effective marginal rate of 60% in the taper zone (40% income tax + 20% from losing the allowance). A bonus that pushes you into this range will be taxed more heavily than the headline rate suggests.
Sources
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Last updated March 2026. Reflects 2025-26 tax year rates.
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