The Salary Calculator

2016 Tax rates available!

by Admin

The Salary Calculator has been updated with the latest tax rates, which take effect from 6th April 2016 – so you can now see how the changes will affect you. Just head over to The Salary Calculator – 2016 take home pay calculator, enter your details and remember to choose the “2016/17” tax year in the drop-down box.

The tax-free personal allowance has been increased by £400, which will reduce the amount of tax most people pay. However, from April 2016 those who have been paying into a pension scheme which is “contracted out” of the additional state pension will find that their National Insurance contributions go up. This is because from April it will no longer be possible to contract out of the pension, so the National Insurance reduction that this gave you no longer applies.

You can try out the 2015 and 2016 take home comparison calculator and see side-by-side how your payslip is likely to change in the new tax year.

Tags: April 2016, budget, HMRC, income tax, national insurance, Pay As You Earn, pension, Pensions, personal allowance, tax rates, The Salary Calculator

5 Comments to 2016 Tax rates available!

1. 

   Hi , I am trying to work out my take home – my annual is 90k with 3% pension and £96 per month medical insurance. I get a company car allowance of £356 per month which I have opted to receive as cash instead of kind. I am unable to get clarification on the deductions due to cash car allowance .
   Can you please help me out in take home calculation? Thanks
Shreya on February 5th, 2016
2. 

   Hi Shreya,
   I’m afraid I don’t have much experience with car allowances paid this way, but I believe that they are treated the same as any other cash income – i.e., they are subject to Income Tax and National Insurance. Effectively, your salary will be £94,272.

   You can enter this value into the Salary Calculator, and enter the £96 per month medical insurance as a taxable benefit. The difficulty is with the pension – car allowances are not normally pensionable, so the 3% you would otherwise enter in the pension field might be too high. You can change the pension percentage so that it gives you 3% of £90,000 – in your example, this is about 2.864%.

   I hope this helps – your employer’s payroll or HR department should be able to explain in more detail.
admin on February 6th, 2016
3. 

   Thanks for your quick response.
Shreya on February 8th, 2016
4. 

   There is an error in the 2016-17 calculation of monthly take home pay as it does not deduct the salary sacrifice amount from the monthly total. You may want to take a look at the functionality and correct it.
John Coady on March 25th, 2016
5. 

   Hi John,
   Can you give me an example of this? I’ve tried to see it myself, but when I enter a salary of £20,000 and £50 salary sacrifice per month, the take-home shows as £1,363.27 per month. Without the salary sacrifice, it is £1,397.27. The difference is not the full £50 because the tax and NI are reduced – this is the benefit of salary sacrifice, you reduce your pay by less than £50 but get £50-worth of whatever you sacrificed for.
   If you could give some details of the calculation not working as you expect, I’ll investigate and try to fix it!
admin on March 25th, 2016

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