How Is a Bonus Taxed in the UK? What You Keep of a Bonus in 2026/27

There is no special "bonus tax". A bonus is added to your salary and taxed like any other pay — at your marginal rate (the rate on your next pound), plus employee National Insurance and any student loan. That is why a bonus always feels more heavily taxed than your salary: your salary is taxed at your average rate, the bonus at your top rate.

What you actually keep

Amount left in your pocket from a bonus, by salary, in 2026/27 (England, Wales and Northern Ireland; tax code 1257L; no pension or student loan):

Salary	£1,000 bonus	£2,500 bonus	£5,000 bonus	£10,000 bonus	Share lost
£25,000	£720	£1,800	£3,600	£7,200	28%
£30,000	£720	£1,800	£3,600	£7,200	28%
£40,000	£720	£1,800	£3,600	£7,200	28%
£50,000	£618	£1,488	£2,938	£5,838	38%–42%
£60,000	£580	£1,450	£2,900	£5,800	42%
£80,000	£580	£1,450	£2,900	£5,800	42%
£100,000	£380	£950	£1,900	£3,800	62%
£120,000	£380	£950	£1,900	£4,529	62%–55%

Three zones explain every row: 28% lost while total pay stays under £50,270 (20% tax + 8% NI); 42% above it (40% + 2%); 62% between £100,000 and £125,140, where each £2 of bonus also removes £1 of personal allowance (the £100k trap). A bonus that straddles a threshold is taxed partly at each rate — the £50,000 row shows a £10,000 bonus losing more than a £1,000 one. In Scotland the rates are 19–48%; use the calculator with "Scottish taxpayer" on, adding the bonus to your salary.

Why the bonus-month payslip can look even worse

PAYE spreads your allowance and bands evenly across the year. In the month a bonus lands, your employer's payroll may put more of that month's pay into the higher band than your annual position justifies; later payslips then take slightly less tax until the year balances. The annual figure is what the table shows. If your bonus is paid in the final pay period of the tax year, or you leave the job soon after, any overpayment comes back through a tax code change or a P800 refund from HMRC.

Paying the bonus into your pension instead

Most employers will let you sacrifice some or all of a bonus into your pension before it is paid. Because it is never treated as pay, there is no income tax and no National Insurance on it (the employer saves 15% NI as well, and some share that). For someone on £60,000, a £5,000 bonus is £2,900 in hand or £5,000 in the pension — £2,100 more saved for the cost of £2,900 of spending money. The case is strongest in the 42% and 62% zones and for anyone just above £100,000 or £60,000 (Child Benefit charge). See salary sacrifice and pension tax relief.

Student loans and bonuses

Student loan repayments are taken from each pay period's earnings above the threshold (Plan 2: £29,385 a year, about £2,449 a month). A bonus month can therefore trigger a large one-off repayment even if your normal pay is below the threshold — 9% of the excess in that month. Unlike tax, this is not evened out later.

Quick answers

Is a bonus taxed differently from salary in the UK?

No. A bonus is ordinary employment income: it is added to your pay for that period and taxed at your marginal income tax rate, with employee National Insurance at 8% (2% above £50,270 of annual pay) and student loan repayments if you have one. There is no separate bonus tax rate.

Why was so much tax taken from my bonus?

Because the bonus is taxed at your marginal rate — the rate on your next £1, not your average rate. A basic-rate taxpayer loses 28% (20% tax + 8% NI); a higher-rate taxpayer 42%; between £100,000 and £125,140 it is 62%, because the bonus also withdraws personal allowance. On a £60,000 salary a £5,000 bonus leaves £2,900. If a bonus pushes one month's pay into a higher band, PAYE can also over-deduct in that month and correct itself over later payslips.

Can I pay my bonus into my pension to avoid the tax?

Often, yes — ask your employer for "bonus sacrifice" before the bonus is paid. The whole bonus goes into your pension free of income tax and National Insurance (your employer saves NI too and some pass part of it on). On a £60,000 salary, a £5,000 bonus is worth £2,900 in your pocket or £5,000 in your pension. Check the annual allowance (£60,000) if your contributions are already large.