1. What is the UK Tax Calculator?

The Money Saving Expert Tax Calculator estimates your UK income tax liability for the 2025 tax year based on current tax bands and rates. It helps you understand how much tax you'll pay on your gross annual income.

2. How Does the Calculator Work?

The calculator uses the UK tax formula for 2025:

Where:

• \( income \) — Gross annual income (GBP)
• 12570 — Personal allowance (tax-free amount)
• 37700 — Basic rate tax band (20%)
• 74870 — Higher rate tax band (40%)
• 125140 — Additional rate threshold (45%)

Explanation: The calculation applies different tax rates to portions of your income that fall within each tax band.

3. Understanding UK Tax Bands

Details: For the 2025 tax year, the UK uses a progressive tax system with three main bands: basic rate (20%), higher rate (40%), and additional rate (45%). The personal allowance of £12,570 is tax-free.

4. Using the Calculator

Tips: Enter your gross annual income in GBP. The calculator will automatically compute your tax liability based on the 2025 tax bands and rates.

5. Frequently Asked Questions (FAQ)

Q1: Does this calculator include National Insurance?
A: No, this calculator only estimates income tax. National Insurance contributions are calculated separately.

Q2: Are tax bands different in Scotland?
A: Yes, Scotland has different income tax bands and rates. This calculator uses the rates for England, Wales and Northern Ireland.

Q3: What if I have other income sources?
A: This calculator only considers employment income. Other income types (dividends, rental income, etc.) may be taxed differently.

Q4: Does this include marriage allowance or other deductions?
A: No, this is a basic calculator that doesn't account for personal circumstances, allowances, or deductions beyond the standard personal allowance.

Q5: Are these tax bands confirmed for 2025?
A: Tax bands are typically confirmed in the annual budget. This calculator uses projected rates based on current information and previous years' patterns.