How these numbers are calculated
National Insurance contributions for employees are calculated on your pay per week.
Pay Per Week |
National Insurance Rate |
First £91 |
NIL |
Salary over £91 and under £610 |
11% |
Salary over £610 |
1% |
Allowance
Your Allowance is the amount of money you are allowed to earn without paying income tax.
Your Personal Allowance depends on your age. For example, if you are under 65 and earn £28,400 per annum your allowance is £4,745. This means you have to pay income tax on £23,655. If you are also blind, you will only pay income tax on £22,095.
If you are married, and you turned 65 before 6th April 2000 you and your spouse receive a Married Couple's Allowance. This is a payment given back to you after your income tax has been deducted. The amount returned is equal to the maximum allowance at 10%, so essentially £572. If you said you were married, the Tax Calculator has factored this figure into your net pay.
Income Tax Rates
There are three bands of income tax. Your taxable income is the amount you earn minus your personal allowance (see above).
- The first £2,020 of your taxable income is taxed at 10%.
- The next £29,379 is taxed at 22%.
- Any further earnings are taxed at 40%.
