Salary sacrifice pension reduces your taxable income.
Bonus Amount
£5,000.00
You Take Home
£3,600.00
Total Deductions
£1,400.00
Effective Rate
28.0%
Marginal Rate
28.0%
Everything you need to know about how bonuses are taxed in the UK
Is there a special bonus tax rate?
No. In the UK, bonuses are taxed as regular income. Your bonus is added to your annual salary and the combined total is taxed according to the standard income tax bands. There is no separate "bonus tax" — HMRC treats it identically to your normal wages.
Why does my bonus seem heavily taxed?
Because your salary has already used your Personal Allowance (£12,570 tax-free) and part of the basic rate band, your bonus is taxed at your marginal rate — the highest rate that applies to your combined income. If your salary plus bonus crosses a tax band threshold, part of the bonus will be taxed at the higher rate.
The £100,000 trap
If your total income (salary + bonus) falls between £100,000 and £125,140, you lose £1 of Personal Allowance for every £2 earned above £100,000. This creates an effective marginal rate of 60% in that band — significantly higher than the standard 40% higher rate.
Can I reduce tax on my bonus?
Yes. Salary sacrifice pension contributions reduce your taxable income before tax and NI are calculated. Use the "Pension Contribution" option above to see the impact. You can also make charitable donations via Gift Aid to reduce your tax liability.
HMRC-Aligned: This calculator uses official HMRC rates and thresholds for the 2025/26 tax year (6 April 2025 – 5 April 2026). Results are indicative — for complex situations, consult a qualified accountant.
Watch Martin Lewis explain how the UK income tax system works — essential viewing before calculating your bonus tax.
£5,000 Bonus on a £30,000 Salary
On a £30,000 salary, your total income with the bonus is £35,000. Since this falls entirely within the basic rate band (up to £50,270), your £5,000 bonus is taxed at 20% for income tax (£1,000) plus 8% employee NI (£400).
Take-home bonus: approximately £3,600 (effective bonus tax rate: ~28%)
£10,000 Bonus on a £50,000 Salary
With a £50,000 salary, your bonus pushes total income to £60,000 — into the higher rate band. The first £270 of your bonus is taxed at 20% (completing the basic band to £50,270), and the remaining £9,730 is taxed at 40%. Employee NI at 2% applies above £50,270.
Take-home bonus: approximately £5,805 (effective bonus tax rate: ~42%)
£20,000 Bonus on a £100,000 Salary
This is where it gets expensive. Above £100,000, your Personal Allowance is tapered at £1 for every £2 of income. A £20,000 bonus means £10,000 of previously tax-free income becomes taxable — creating an effective 60% marginal rate in the £100,000–£125,140 taper zone (40% income tax + 20% PA loss + 2% NI).
Take-home bonus: approximately £8,400 (effective bonus tax rate: ~58%)
This calculator uses official rates and thresholds from:
Last verified: February 2026 · Tax year 2025/26. Results are indicative — consult a qualified accountant for personalised advice.
Reviewed by M. Samiuddin Quadri, ACCA — Chartered Certified Accountant at Gladstone & Co. · Updated for the 2025/26 tax year.
Disclaimer: This calculator provides estimates based on current HMRC rates and thresholds for the 2025/26 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant or tax adviser before making financial decisions. Read our terms
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