Tax dials

Companion to the economy dashboard. Set a salary, move the rates and thresholds, and see what changes on the payslip, where each £100 goes, what happens to national receipts, and what it costs to give someone their first job.

Baseline: 2026/27 UK rules (England, Wales, NI)
Built 8 Sep 2026 · estimates, not a tax calculator

Your payslip

Annual figures for the salary above. Employer costs are what it takes to put you on the payroll.

Every £100 you pay in income tax and NI

Split using HM Treasury's spending-by-function shares (the same method as HMRC's Annual Tax Summary). Same proportions for everyone; only the £ changes.

Take-home and marginal rate across incomes

Solid = current rules, dashed = your dials. Marginal rate is what you keep from the next £1 (income tax + employee NI). Watch the 60% cliff at £100k and the NI step at £50k.

The indirect aside: what else this job pays

Estimates for a typical household at this income. VAT assumes about 55% of spending is standard-rated.

Cost of a first job

Same £24,000 salary, two ages. Under-21s (and apprentices under 25) are exempt from employer NI up to £50,270.

What your dials do to the national numbers

£bn per year against a 2026/27 baseline. "Static" is arithmetic; "with behaviour" applies the elasticity dial; "with multiplier" adds tax recovered from the spending boost.

How it works, and where to be careful

  • Payslip uses the standard bands with the personal-allowance taper. Scotland's income tax bands differ and aren't modelled. Student loans, pensions relief, child benefit clawback and marriage allowance are left out.
  • Your £100 uses 2026/27 planned spending by function (£1.4tn total). Local councils don't appear as a line because their spending sits inside education, social care, housing and transport; police and fire are in public order, ambulances in health.
  • National receipts come from applying your dials to a stylised distribution of 38 million people with taxable income (log-normal, median £28k, a fat upper tail), calibrated so the baseline matches OBR forecasts: income tax £335bn, employee NI £65bn, employer NI £150bn, VAT £195bn. Income tax on savings, dividends and pensions is scaled in but not modelled separately, so the tool is good for direction and rough size, not for Budget arithmetic.
  • Behaviour: each earner's taxable income moves by elasticity × Δln(1 − marginal rate). At 0.25 a cut in the top rate recovers some of its cost; at 0 nothing does. Multiplier: a net tax cut of £X raises GDP by mult × X in year one, and about 37% of any GDP gain returns as tax. The "self-financing share" tile is what fraction of a cut comes back. Under most settings it is well under half, which is the mainstream finding; set the multiplier above 1 and the elasticity high to see the supply-side case.
  • Redistribution slider: the lowest-paid X% (by the model's earnings distribution) get an extra personal allowance, phased out over the next 30% of income so there's no cliff. The tool solves the surcharge on income above the cut-off that makes it revenue-neutral before behaviour. Employer costs are untouched by construction. The catch is visible in the marginal-rate chart: the phase-out band and the surcharge both raise marginal rates for people just above the cut-off.
  • Flat tax: one rate on all income from the first pound (so the personal allowance goes too), solved to raise the same money as income tax plus whatever else you tick. With NI and VAT all replaced it needs roughly half of every pound; untick VAT and it drops sharply. The break-even row on the payslip shows who wins: a flat rate with no allowance shifts the burden down the income scale, which is why real-world "flat taxes" (Estonia, Hong Kong) keep a large allowance and don't try to replace consumption taxes.
  • Fiscal drag: the uprating dial raises every threshold together. It reproduces what indexation to inflation would have done since the 2021 freeze; the cost shown is the cost of "unfreezing".
  • VAT revenue is scaled proportionally to the rate with a small (−0.2) demand response. Zero-rated items (most food, children's clothes, books) are unaffected, which is why a VAT cut helps higher spenders more in £ terms.

Sources. HMRC rates and thresholds 2026/27; OBR Economic and Fiscal Outlook (receipts); HM Treasury PESA 2026 and Budget 2026/27 spending by function; HM Treasury guidance on the Annual Tax Summary method; ONS ASHE 2025 (earnings distribution); HMRC Survey of Personal Incomes (distribution shape); OBR fiscal multipliers; HMRC taxable-income elasticity estimates. Council tax uses the England average Band D. Not financial or tax advice.