This free Excel take-home pay calculator estimates income tax, employee National Insurance, employer National Insurance and net pay for one salary in the 2026-27 tax year. Type the gross annual salary, check the tax code, pay period and NI category, and the Summary shows annual and per-period take-home pay plus the full cost of employing.
What does the calculator show for a £42,000 salary?
On tax code 1257L, paid monthly, NI category A, the calculator returns:
| Line | Annual | Per month |
|---|---|---|
| Gross pay | £42,000.00 | £3,500.00 |
| Income tax | £5,886.00 | £490.50 |
| Employee NI | £2,354.40 | £196.20 |
| Take-home pay | £33,759.60 | £2,813.30 |
| Employer NI (on top of salary) | £5,550.00 | £462.50 |
The tax is 20% of the £29,430 earned above the £12,570 personal allowance. Employee NI is 8% of the same slice, because the salary sits below the £50,270 upper earnings limit. Employer NI is 15% of everything above £5,000, so the total cost of this employee is £47,550 a year.
Which tax codes and NI letters does it understand?
The calculator reads the tax code rather than matching one fixed value. It handles numeric L, M, N and T codes, 0T, BR and NT, the Welsh C prefix and the emergency suffixes W1, M1 and X. Above £100,000 of income it reduces the personal allowance by £1 for every £2, but only on the standard 1257L code. Any other code is used as issued, because HMRC has already built your adjustments into it, so the reduction is not taken twice.
S (Scottish) and K codes are flagged as not supported, and the tax lines stay blank instead of showing a wrong figure. The NI category letter changes both the employee rate and where employer NI starts. For example, category M (under 21) pays no employer NI up to £50,270, and category B uses the reduced 1.85% rate.
What it leaves out
This is an estimate for planning a hire or checking a payslip, not a payroll system. It does not include Scottish rates, student loans, postgraduate loans, pensions, salary sacrifice, benefits in kind or the Employment Allowance. To run payroll and report to HMRC you need RTI payroll software.
Do you also have self-employed income?
PAYE only covers employment income. If you also earn from self-employment or property, those profits go through Self Assessment, and once that qualifying income is over £50,000 you also need to keep digital records and send quarterly updates under Making Tax Digital. Check where you stand with the MTD qualifying income guide.
