Bonus Tax Calculator (2026/27)
Enter your annual salary and your bonus — the calculator works out the extra tax and National Insurance the bonus triggers, and the net amount you actually keep.
How it works
A bonus is not taxed at a special "bonus rate" — it is simply added to your earnings for the year and taxed at your MARGINAL rates. The calculator runs the full 2026/27 tax and NI computation twice (salary alone, then salary + bonus); the difference is the true cost of tax on your bonus.
Because the bonus sits on top of your salary, it is taxed at your highest band: a basic-rate earner keeps roughly 72% of a bonus (20% tax + 8% NI), a higher-rate earner about 58% (40% + 2%), and an additional-rate earner about 53%.
The nasty surprise is the £100,000–£125,140 zone: there the personal allowance tapers away (£1 lost per £2 of income), producing an effective ~62% marginal rate — a £10,000 bonus can leave under £4,000. Salary-sacrificing the bonus into a pension avoids this entirely; see our salary sacrifice calculator.
FAQ
Why was my bonus taxed so heavily in the month I got it?
PAYE spreads your tax code over the year, so in the month a bonus lands, payroll often assumes you will earn at that higher rate every month and deducts more — sometimes pushing you into a higher band for that period only. Over the following months the cumulative system corrects itself automatically, so the over-deduction comes back in later payslips. This calculator shows the correct full-year position.
What rate of tax do I pay on a bonus?
Your marginal rate — the rate on your top slice of income. In 2026/27 that means 20% tax + 8% NI up to £50,270 total income, 40% + 2% between £50,270 and £100,000, an effective ~62% between £100,000 and £125,140 (personal allowance taper), and 45% + 2% above £125,140. If the bonus straddles a threshold, each part is taxed at its own band — the calculator handles the split exactly.
Can I reduce the tax on my bonus?
The main lever is paying some or all of it into your pension via salary sacrifice or a personal contribution: sacrificed bonus escapes both income tax and NI, so £1 of bonus becomes £1 of pension instead of ~58p of cash for a higher-rate earner. This is especially powerful in the £100k–£125k taper zone, where it also restores your personal allowance and can protect free childcare hours eligibility. Ask your employer before the bonus is processed — it usually cannot be sacrificed retrospectively.