Better off in work calculator
Wages minus tax and National Insurance, then Universal Credit reduced by the 55% taper. See the real change in your monthly income and what you keep from the next £100.
How the calculation works
Two things happen when you earn more. Your wage is taxed, so above the personal allowance you pay 20% income tax and 8% National Insurance on the extra. Then Universal Credit tapers: for every £1 of net earnings above your work allowance, your UC drops by 55p. The two stack, which is why the gain feels smaller than the pay rise, but you are almost always left with more overall.
The figure to watch is what you keep from the next £100. Below the tax threshold that is about £45, because only the taper applies. Once tax and National Insurance start, it falls to around £32. That is still money gained, so on the taper alone work pays. The real risk is a cliff edge, where a passported benefit stops all at once. Free school meals no longer work that way in England, because from the 2026/27 school year every household on Universal Credit qualifies whatever it earns. Healthy Start still does, so the tool flags the £408 a month take-home line for anyone pregnant or with a child under 4.
Worked example
Going from £800 to £1400 a month gross, with a work allowance and housing help, your take-home rises but Universal Credit tapers away part of it. The net result here is about £282 more a month in total income, and you keep roughly £72 of the next £100 you earn. You are better off, but by less than the headline pay rise suggests.
Common questions
Will I actually be better off taking more hours?
Usually yes, because Universal Credit tapers rather than stops. For every £1 of net earnings above your work allowance you lose 55p of UC, so you still keep something from each extra pound. This tool shows the net gain once tax, National Insurance and the taper are all counted.
What is the work allowance?
It is the amount you can earn each month before the Universal Credit taper starts. For 2026/27 it is £710 a month if your award has no housing element, or £427 a month if it does. You only get a work allowance if you have children or limited capability for work.
How much do I keep from the next £100 I earn?
It depends where you sit. Below the tax threshold you keep about £45 of the next £100 after the 55% taper. Once income tax and National Insurance also apply, you keep closer to £32. The result box shows your figure for the after level you entered.
What is a cliff edge?
A cliff edge is where a small rise in earnings loses you a whole benefit at once rather than gradually. The Universal Credit taper has no cliff edge. Free school meals no longer have one in England either: from the 2026/27 school year every household on Universal Credit qualifies regardless of income. Healthy Start still does, since it stops once take-home pay from work is above £408 a month, so the tool flags that line for anyone pregnant or with a child under 4. Some council schemes also have their own income limits.
Does this include help with childcare?
Not directly. Universal Credit can refund up to 85% of childcare costs, which changes the picture considerably for working parents. Treat this tool as the wage and taper core, then add childcare support separately using the Tax-Free Childcare and UC childcare rules.