Translation unavailable - this article is shown in English. View English version
Summary
Bonuses in the UK are taxed as part of your regular earnings — there is no special “bonus tax rate.” However, bonuses often appear to be taxed more heavily because they are typically added to a single month’s pay, pushing that month into a higher PAYE bracket. The calculator shows how much of your bonus you actually take home after income tax, National Insurance, pension, and student loan deductions.
How it works
Why bonuses seem heavily taxed
PAYE (Pay As You Earn) collects tax in real time. When a bonus is paid alongside your regular salary in a single pay period, your employer’s payroll system sees a much higher income for that month. Depending on the PAYE method used, this can result in higher immediate deductions:
Cumulative method (standard PAYE): Your employer calculates tax cumulatively from April 6. A bonus in month 10 means the system recalculates your year-to-date tax. If the bonus pushes your cumulative earnings into a higher band, the extra tax is collected that month. However, this should self-correct by year-end.
Month-1 / Week-1 (non-cumulative): Each pay period is treated independently. A £5,000 bonus added to a £4,000 monthly salary gives £9,000 for that month — annualized to £108,000, which crosses into the personal allowance taper zone. This can result in significantly higher deductions for that month.
The actual tax treatment
Over the full tax year, a £5,000 bonus on top of a £50,000 salary is taxed exactly the same as if you earned £55,000 in regular salary. The difference is only in the timing of deductions within the year. Any overtaxation under the month-1 basis is corrected cumulatively or via a tax refund.
Marginal rate on the bonus
The effective tax rate on the bonus depends on which band it falls into:
| Base salary | Bonus falls in band | Marginal rate (tax + NI) |
|---|---|---|
| Under £50,270 | Basic rate | 28% (20% tax + 8% NI) |
| £50,270 - £100,000 | Higher rate | 42% (40% tax + 2% NI) |
| £100,000 - £125,140 | PA taper zone | 62% (40% tax + 20% taper + 2% NI) |
| Over £125,140 | Higher rate | 42% (40% tax + 2% NI) |
Worked example
Base salary: £45,000, Bonus: £8,000
- Total annual earnings: £53,000
- Tax on first £12,570: £0 (personal allowance)
- Tax on £12,571-£50,270 at 20%: £7,540
- Tax on £50,271-£53,000 at 40%: £1,092
- Total income tax: £8,632
- Without bonus (on £45,000): income tax = £6,486
- Tax attributable to the bonus: £8,632 - £6,486 = £2,146 (26.8% of bonus)
- NI on bonus: £5,270 at 8% + £2,730 at 2% = £476 (5.9%)
- Total deductions from bonus: £2,622
- Net bonus: £8,000 - £2,622 = £5,378 (67.2% kept)
The blended rate is lower than the pure marginal rate because part of the bonus still falls in the basic rate band.
Inputs explained
- Annual salary — your regular gross salary excluding the bonus
- Bonus amount — the one-off payment to be taxed
- Tax year — determines rates and thresholds
- Pension contribution — if your bonus is subject to pension deductions
- Student loan plan — if applicable
Outputs explained
- Net bonus — the amount you actually receive after all deductions
- Tax on bonus — income tax attributable to the bonus (marginal calculation)
- NI on bonus — National Insurance on the bonus amount
- Effective rate — total deductions as a percentage of the bonus
- Combined salary + bonus breakdown — full year picture
Assumptions & limitations
- The calculator uses an annual basis for accuracy. In practice, the timing of deductions within the year may differ due to PAYE methodology.
- Employer NI on the bonus (15% above the secondary threshold) is not deducted from the employee’s pay but represents a real cost to the employer.
- Bonuses paid via payroll are subject to the same deductions as salary. Bonuses paid as benefits in kind have different tax treatment.
- Does not model bonus sacrifice into pension, which can be a tax-efficient strategy especially for earners in the PA taper zone.