PayBreakdown - Salary Calculator & Budget Manager
How are bonuses taxed?
Bonuses are usually treated as employment income, so they can affect PAYE income tax, National Insurance, student loan, and pension deductions.
What this page helps with
A bonus is usually taxed through payroll as employment income. The deduction can look high because the bonus is added to normal pay for the period and can affect marginal tax, NI, student loan, and pension calculations.
Official sources
Income Tax rates and Personal AllowancesNational Insurance rates and categoriesStudent loan repayment thresholdsPension tax reliefNational Minimum Wage and National Living Wage ratesStatutory Maternity Pay and LeaveStatutory Sick PayFCA guidance on misleading financial promotionsOff-payroll working and IR35 guidanceUnderstanding off-payroll workingSalary sacrifice for employersNHS Employers pay scales 2026/27NHS Health Careers Agenda for Change pay ratesLast updated 2026-05-07. Planning estimates only. Not financial advice.