Taxes in the UK

One of the most important things to learn when you are moving to the UK is how the Tax system works.

Taxes influence your take-home income, so you definitely want to make sure you understand how much tax you’ll need to pay.

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❓ Frequently Asked Questions

How do taxes work in the UK?
How do I pay my taxes in the UK?

💰 Income Tax Brackets

The UK taxes income based on how much you earn. All income brackets have a Personal Allowance of £12,570 but the tax rate is different for each.

Tax brackets are generally as per the below. This will look different if you live in Scotland, Wales or Ireland, but this is a good indication for those who are moving to London.

There are additional tax-free allowances for certain individuals:

- Trading Allowance: Your first £1,000 of income from self-employment
- Property Rental Allowance: Your first £1,000 of income from property you rent (unless you’re using the Rent a Room Scheme)
- Marriage Allowance: Lets you transfer £1,260 of your Personal Allowance to your husband, wife or civil partner. This reduces their tax by up to £252 in the tax year (6 April to 5 April the next year).

All information is referenced from the UK GOV website

National Insurance Contributions

National insurance contributions (NICs) are paid by employees and employers and go towards funding the UK’s social security system. If you’re employed in the UK, you’ll pay Class 1 NICs, which are calculated as a percentage of your earnings as per the below breakdown:

To read about other NICs Classes, head to the UK Government Website. You can also check your National Insurance Records.
Check My National Insurance Records

🤑 UK Tax Calculator

Calculate your take-home income by adding your annual salary below. Matutto does not keep record of this data to protect your privacy.
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