Some information about the figures used to generate the answers displayed in The Salary Calculator:
Income Tax
| Under 65 Allowance | £6,475 |
| 65 to 75 Allowance | £9,490 |
| Over 75 Allowance | £9,640 |
| 65+ Income Limit | £22,900 |
| Income Limit | £100,000 |
| Blindness Allowance | £1,890 |
| Married Rebate | £696.50 |
| £0 - £37,400 | 20% |
| £37,401 - £150,000 | 40% |
| over £150,000 | 50% |
The Salary Calculator uses Income tax information from April 2010 to calculate the deductions made on a salary. Taxable income is salary over and above the tax allowance for your circumstances.
If you are under 65 years old, this tax allowance is £6,475. If you are between 65 and 75, the allowance is £9,490. If you are over 75, the allowance is £9,640. However, over-65s earning more than the Income Limit of £22,900 have their personal allowance reduced by £1 for every £2 over the limit, until it reaches the basic under-65 allowance.
From April 2010, those earning over £100,000 also have their personal allowance reduced - by £1 for every £2 they earn over £100,000 until their allowance reaches zero, regardless of age.
Blind people get an extra £1,890 on their tax allowance. Married people over the age of 75 receive a tax rebate, after other deductions have been made, of £696.50.
Any taxable income up to £37,400 is taxed at 20%, from £37,401 to £150,000 is taxed at 40% and taxable income over £150,000 is taxed at the rate of 50%, introduced in April 2010. The 10% "Starting Rate" of income tax was removed in the April 2008 budget.
National Insurance
| Below £110/week | 0% |
| £110 - £844/week | 11% |
| Above £844/week | 1% |
If your gross income (ie before tax) is less than £110 per week, you will make no National Insurance contributions. Gross earnings between £110 and £844 per week are charged at 11%. Any earnings over £844 per week are charged at 1%.
If you are receiving the State Pension, you do not have to pay National Insurance. For the purposes of The Salary Calculator, we have simplified this so that if you are 65 or over, National Insurance contributions are zero.
Student Loan
| Below £15,000 | 0% |
| Above £15,000 | 9% |
The Student Loan is repayed at a rate of 9% on any gross earnings over £15,000 per annum. This took effect from April 2005 - previously the threshold was £10,000. There is no change to this from April 2010.
Pension Contributions
Pension contributions are calculated by deducting the percentage rate you enter into the "Pension" field from your standard salary (not including overtime). You don't pay tax on pension contributions, so your "taxable income" for Income Tax (see above) is reduced by the amount you pay to your pension. This is an estimate - each employer calculates "pensionable pay" differently and so it may not exactly match The Salary Calculator. More information on The Salary Calculator blog.
Mortgage Calculations
The Mortgage Repayment Calculator uses an iterative process to home in on a repayment amount that completes the mortgage after the entered time period has passed. It also does not include any information about building society fees, or variable rates.
For these reasons, The Mortgage Repayment Calculator is intended just to provide a ballpark figure to allow you to get an idea of the costs of different interest rates etc. Care has been taken to try to make these values accurate, but figures from mortgage lendors are likely to differ.