1. What is Salary Percentage Increase?

The salary percentage increase measures how much a salary has grown relative to its original amount. It's particularly important for UK tax planning as significant increases may affect your tax bracket, National Insurance contributions, and other financial considerations.

2. How Does the Calculator Work?

The calculator uses the percentage increase formula:

Where:

• New Salary — Your current or proposed salary amount in GBP
• Old Salary — Your previous salary amount in GBP

Explanation: The formula calculates the difference between the new and old salary, then shows what percentage this difference represents of the original salary.

3. Importance for UK Tax Purposes

Details: In the UK, salary increases can move you into higher tax brackets (basic rate 20%, higher rate 40%, additional rate 45% in England/Wales/Northern Ireland). This calculator helps anticipate tax implications of salary changes.

4. Using the Calculator

Tips: Enter both salaries in GBP (before tax). The calculator works with both annual and monthly figures (just be consistent). Negative results indicate a salary decrease.

5. Frequently Asked Questions (FAQ)

Q1: Does this include bonuses or just base salary?
A: You can calculate either way - just be consistent in what you include in both old and new salary figures.

Q2: How does this affect my UK tax code?
A: Significant increases may trigger a tax code change by HMRC, especially if you move into a higher tax bracket.

Q3: What about National Insurance contributions?
A: NI is calculated differently (weekly/monthly), but salary increases may affect your NI category and payments.

Q4: Should I include pension contributions?
A: For accurate take-home pay calculations, consider whether your pension contributions are salary sacrifice or not.

Q5: How does this affect student loan repayments?
A: Salary increases may increase your student loan repayments if you're above the Plan 1 (£22,015) or Plan 2 (£27,295) thresholds.