Month-by-month payslip calculator

How cumulative PAYE works

Payroll never divides your year by twelve. It runs the same five steps every month, and the result is that each payslip depends on every payslip before it.

1. Count the tax month. The tax year starts on 6 April, so April is month 1 and March is month 12. Your payslip prints this number.
2. Release the tax-free pay to date. In month M you get M twelfths of the allowance your code carries. On 1257L that is about £1,048.25 a month, so by month 9 you have had roughly £9,434 of tax-free pay whether you used it or not.
3. Add up the taxable pay to date. Everything paid in this job since 6 April, less any pension taken before tax, less the tax-free pay released. That running total is what your tax is charged on.
4. Work out the tax due on the year so far. The bands grow at the same rate: by month M you have M twelfths of the £37,700 basic rate band and M twelfths of the higher rate band above it.
5. Deduct the difference. This month's tax is the tax due to date minus the tax already deducted. If that comes out negative, the payslip pays you a refund.

National Insurance follows none of this. It is charged on each pay period alone, at 8% of the pay between £1,048 and £4,189 in that month and 2% on anything above £4,189. There is no running total, no allowance carried forward and no correction later. That single difference explains most of the payslips people cannot reconcile.

Student loan repayments work the same way as National Insurance: 9% of the pay above the monthly threshold, taken from that month alone and rounded down to whole pounds. A spike month costs you more student loan permanently, and unlike income tax it is never given back through payroll.

Two small rounding conventions mean the twelve payslips never add up to exactly the annual figure, even on a level salary. HMRC's free pay tables work from the code number times ten plus nine, so 1257L actually frees £12,579 across the year rather than £12,570, worth about £1.80 of tax. The monthly National Insurance threshold of £1,048 comes to £12,576 over twelve months rather than £12,570, worth about 50p. Real payroll produces the same rounding, so these pennies are in your payslips too.

The bonus month, worked through

Take a £48,000 salary on code 1257L with a £10,000 bonus paid in December, which is tax month 9. An ordinary month before the bonus looks like this: gross £4,000.00, income tax £590.35, National Insurance £236.16, take-home £3,173.49.

Two things happen at once in December, and they pull in opposite directions. Income tax jumps from £590.35 to £4,248.50, because the bonus lands on top of the pay to date and pushes part of the year into the 40% band immediately rather than at the end of the year. National Insurance rises in cash terms but falls as a proportion, from 5.9% of the month to 3.2%, because £9,811.00 of that month sits above the £4,189 upper earnings limit where only 2% is charged.

The extra National Insurance on the whole £10,000 bonus is about £211.34, roughly 2.1% of it. Over the year the twelve real payslips take £3,045 of National Insurance, while an annual calculator on the same £58,000 shows £3,171. Paying the same money unevenly across the year saves about £125 of National Insurance, which an annual calculator cannot show.

January then costs £552.36 in tax, less than the £590.35 of an ordinary month before the bonus, because another twelfth of the basic rate band has been released and part of what was charged at 40% comes back down to 20%. That is the correction people are told to expect, arriving quietly inside their own payslip rather than as a refund from HMRC.

Starting a job part way through the tax year

Your tax-free pay accrues from 6 April whether you are working or not, and a cumulative code hands you all of it on the first payslip. Start in August, month 5, and about £5,241 of tax-free pay is available on that first payslip instead of £1,048. On a normal salary that means the first one or two payslips carry very little tax, sometimes none at all, before settling to the usual figure.

This only works if your employer runs a cumulative code. Without a P45, and depending on which starter declaration you tick, you may be put on 1257L W1/M1, which throws the accrued allowance away and taxes each month as though it were the first. Switch the basis above to see both versions side by side. The Week 1 / Month 1 figures are the ones you would have to reclaim from HMRC later.

What to check against your own payslip

• Tax period or month number. April is 1, March is 12. If yours says a different number from the calendar month you expect, that is normal.
• Taxable pay to date. This should match the running total in the table above, so long as the salary, pension and bonus you entered are right.
• Tax paid to date. Add the tax column in the table down to your month and compare.
• Tax code and basis. A W1, M1 or X after the code changes the whole calculation, because no month ever corrects another.
• National Insurance letter. This page assumes category A, the standard letter for most employees.

The figures here use the standard rates for 2026/27 and the England, Wales and Northern Ireland bands. Scotland sets different income tax bands, and National Insurance is the same everywhere in the UK. Above £100,000 HMRC usually reduces your code instead of applying the allowance taper through payroll, so enter the code from your payslip rather than 1257L if you are in that band.